================================================================================
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1998
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
Commission File No. 0-20260
Commission File No. 1-11440
INTEGRAMED AMERICA, INC.
(Exact name of Registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation or organization)
One Manhattanville Road
Purchase, New York
(Address of principal executive offices)
06-1150326
(I.R.S. employer identification no.)
10577
(Zip code)
(914) 253-8000
(Registrant's telephone number, including area code)
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
No [ ] Yes [X]
The aggregate number of shares of the Registrant's Common Stock, $.01
par value, outstanding on May 1, 1998 was 21,344,423.
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<PAGE>
INTEGRAMED AMERICA, INC.
FORM 10-Q
TABLE OF CONTENTS
PAGE
PART I - FINANCIAL INFORMATION
Item 1. Financial Statements
Consolidated Balance Sheet at March 31, 1998 (unaudited)
and December 31, 1997....................................3
Consolidated Statement of Operations for the three-month
period ended March 31, 1998 and 1997 (unaudited).........4
Consolidated Statement of Cash Flows for the three-month
period ended March 31, 1998 and 1997 (unaudited).........5
Notes to Consolidated Financial Statements (unaudited)...6-14
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.................................15-18
Item 3. Quantitative and Qualitative Disclosures About Market Risk...18
PART II - OTHER INFORMATION
Item 1. Legal Proceedings............................................19
Item 2. Changes in Securities........................................19
Item 3. Defaults upon Senior Securities..............................19
Item 4. Submission of Matters to a Vote of Security Holders..........19
Item 5. Other Information............................................19
Item 6. Exhibits and Reports on Form 8-K.............................19
SIGNATURES ......................................................20
INDEX TO EXHIBITS..........................................................21-22
2
<PAGE>
PART I - FINANCIAL INFORMATION
Item 1. Consolidated Financial Statements
<TABLE>
INTEGRAMED AMERICA, INC.
CONSOLIDATED BALANCE SHEET
(all dollars in thousands)
ASSETS
<CAPTION>
March 31, December 31,
--------- ------------
1998 1997
--------- ------------
(unaudited)
Current assets:
<S> <C> <C>
Cash and cash equivalents .......................................................... $ 2,379 $ 1,930
Patient accounts receivable, less allowance for doubtful accounts of $216 and $180
in 1998 and 1997, respectively.................................................... 10,785 7,061
Management fees receivable, less allowance for doubtful accounts of $261 and $214
in 1998 and 1997, respectively.................................................... 2,049 1,600
Other current assets ............................................................... 2,500 1,757
------- -------
Total current assets............................................................ 17,713 12,348
------- -------
Fixed assets, net .................................................................. 5,366 4,742
Intangible assets, net.............................................................. 25,243 18,445
Other assets........................................................................ 558 566
------- -------
Total assets.................................................................... $48,880 $36,101
======= =======
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable.................................................................... $ 340 $ 1,475
Accrued liabilities................................................................. 3,829 2,260
Due to Medical Practices (see Note 2)............................................... 2,200 1,745
Dividends accrued on Preferred Stock................................................ 497 464
Current portion of exclusive management rights obligation........................... 472 472
Note payable and current portion of long-term debt.................................. 1,900 614
Patient deposits ................................................................... 1,370 1,236
------- -------
Total current liabilities....................................................... 10,608 8,266
------- -------
Exclusive management rights obligation................................................ 1,391 1,391
Long-term debt ....................................................................... 3,696 451
Commitments and Contingencies......................................................... -- --
Shareholders' equity
Preferred Stock, $1.00 par value -
3,165,644 shares authorized in 1998 and 1997, respectively - 2,500,000
undesignated; 665,644 shares designated as Series A Cumulative Convertible
of which 165,644 shares were issued and outstanding in 1998 and
1997, respectively................................................................ 166 166
Common Stock, $.01 par value - 25,000,000 shares authorized; 21,344,423 and
17,198,616 shares issued and outstanding in 1998 and 1997, respectively........... 213 172
Capital in excess of par ........................................................... 53,412 46,471
Accumulated deficit ................................................................ (20,606) (20,816)
------- -------
Total shareholders' equity ..................................................... 33,185 25,993
------- -------
Total liabilities and shareholders' equity...................................... $48,880 $36,101
======= =======
See accompanying notes to the consolidated financial statements.
</TABLE>
3
<PAGE>
<TABLE>
INTEGRAMED AMERICA, INC.
CONSOLIDATED STATEMENT OF OPERATIONS
(all amounts in thousands, except per share amounts)
<CAPTION>
For the
three-month period
ended March 31,
------------------
1998 1997
------ ------
(unaudited)
<S> <C> <C>
Revenues, net (see Note 2)................................................. $8,746 $4,692
Operating expenses incurred on behalf of Network Sites:
Employee compensation................................................... 3,731 1,866
Direct materials........................................................ 785 304
Occupancy costs......................................................... 714 417
Depreciation............................................................ 311 207
Other expenses.......................................................... 1,468 821
------ ------
Total operating expenses incurred on behalf of Network Sites............ 7,009 3,615
------ ------
Network Sites' contribution................................................ 1,737 1,077
General and administrative expenses........................................ 1,185 977
Amortization of intangible assets.......................................... 233 137
Interest income............................................................ (12) (34)
Interest expense........................................................... 72 10
------ ------
Total other expenses....................................................... 1,478 1,090
------ ------
Income (loss) before income taxes.......................................... 259 (13)
Provision for income taxes................................................. 49 32
------ ------
Net income (loss).......................................................... 210 (45)
Less: Dividends accrued on Preferred Stock................................. 33 33
------ ------
Net income (loss) applicable to Common Stock............................... $ 177 $ (78)
====== ======
Basic earnings (loss) per share of Common Stock............................ $0.01 $(0.01)
====== ======
Diluted earnings (loss) per share of Common Stock.......................... $0.01 $(0.01)
====== ======
Weighted average shares - basic............................................ 20,024 9,544
====== ======
Weighted average shares - diluted.......................................... 20,401 9,544
====== ======
</TABLE>
See accompanying notes to the consolidated financial statements.
4
<PAGE>
<TABLE>
INTEGRAMED AMERICA, INC.
CONSOLIDATED STATEMENT OF CASH FLOWS
(all amounts in thousands)
<CAPTION>
For the
three-month period
ended March 31,
---------------------
1998 1997
------- -------
(unaudited)
Cash flows from operating activities:
<S> <C> <C>
Net income (loss) .......................................................... $ 210 $ (45)
Adjustments to reconcile net income (loss) to net cash used in operating activities:
Depreciation and amortization.............................................. 581 417
Writeoff of fixed and other assets ........................................ 37 55
Changes in assets and liabilities-- (Increase) decrease in assets:
Patient accounts receivable........................................... (2,384) (277)
Management fees receivable............................................ (449) (508)
Other current assets.................................................. (701) (96)
Other assets.......................................................... 8 (5)
Increase (decrease) in liabilities:
Accounts payable..................................................... (1,435) (445)
Accrued liabilities.................................................. 86 (377)
Due to Medical Practices............................................. 455 102
Patient deposits..................................................... (78) 91
------ ------
Net cash used in operating activities...................................... (3,670) (1,088)
------ ------
Cash flows (used in) provided by investing activities:
Proceeds from short term investments..................................... -- 2,000
Purchase of net liabilities (assets) of acquired businesses.............. 487 (29)
Payments for exclusive management rights and related acquisition costs... (3,109) (1,635)
Purchase of fixed assets and leasehold improvements...................... (438) (64)
Proceeds from sale of fixed assets....................................... -- 80
------ ------
Net cash (used in) provided by investing activities......................... (3,060) 352
------ ------
Cash flows provided by (used in) financing activities:
Proceeds from issuance of Common Stock................................... 5,500 --
Used for stock issue costs............................................... (61) --
Proceeds from bank under Credit Facility................................. 2,000 250
Principal repayments on debt............................................. (286) (52)
Principal repayments under capital lease obligations..................... (36) (27)
Proceeds from exercise of Common Stock options........................... 62 14
------ ------
Net cash provided by financing activities..................................... 7,179 185
------ ------
Net increase (decrease) in cash and cash equivalents.......................... 449 (551)
Cash and cash equivalents at beginning of period.............................. 1,930 3,952
------ ------
Cash and cash equivalents at end of period.................................... $2,379 $3,401
====== ======
</TABLE>
See accompanying notes to the consolidated financial statements.
5
<PAGE>
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
NOTE 1 -- INTERIM RESULTS:
The accompanying unaudited consolidated financial statements have been
prepared in accordance with the instructions to Form 10-Q and, accordingly, do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. In the opinion of
management, the accompanying unaudited interim financial statements contain all
adjustments (consisting only of normal recurring accruals) necessary to present
fairly the financial position at March 31, 1998, and the results of operations
and cash flows for the interim period presented. Operating results for the
interim period are not necessarily indicative of results that may be expected
for the year ending December 31, 1998. These financial statements should be read
in conjunction with the financial statements and notes thereto included in the
Company's Annual Report on Form 10-K for the year ended December 31, 1997.
NOTE 2 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Basis of consolidation --
The consolidated financial statements comprise the accounts of IntegraMed
America, Inc. and its wholly owned subsidiaries, IVF America (NY), Inc., IVF
America (MA), Inc., IVF America (PA), Inc., IVF America (NJ), Inc., IVF America
(MI), Inc., IntegraMed America of Illinois, Inc., Shady Grove Fertility Centers,
Inc. (see Note 6) and the Adult Women's Medical Center, Inc. ("AWMC"). All
significant intercompany transactions have been eliminated. The Company derives
its revenues from management agreements and, with respect to one managed Network
Site and AWMC, from patient service revenues. The Company does not consolidate
the results of its managed Network Sites.
In 1997, the Emerging Issues Task Force of the Financial Accounting
Standards Board (the "EITF") issued EITF No. 97-2. The EITF reached a consensus
concerning certain matters relating to the physician practice management ("PPM")
industry with respect to the consolidation of professional corporation revenues
and the accounting for business corporations. As an interim step before the
consensus, the EITF allowed PPMs to display the revenues and expenses of managed
physician practices in the statement of operations (the "alternative display
method") if the terms of the management agreement provided the PPM with a "net
profits or equivalent interest" in the net profits of the medical services
furnished by the Medical Practices. It is the Company's understanding that the
EITF did not and would not object to the use of the alternative display method
in PPM financial statements for periods ending before December 15, 1998. As the
Company does not consolidate its managed Network Sites, the adoption of EITF
97-2 in 1998 does not have a material impact on the Company's financial
position, cash flows or results of operations. As discussed below, the Company
has discontinued the display of revenues for its Long Island and Boston Network
Sites due to changes in the respective management agreements.
Since inception through December 31, 1997, the management agreements
related to the Long Island and Boston Network Sites have been incorporated in
the Company's consolidated financial statements via the display method as the
Company believed that these management agreements provided it with a "net
profits or equivalent interest" in the net profits of the medical services
furnished by the Medical Practices at the Long Island and Boston Network Sites.
Consequently, for the Long Island and Boston Network Sites, the Company has
historically presented the Medical Practices' patient services revenue, less
amounts retained by the Medical Practices, or "Medical Practice retainage", as
"Revenues after Medical Practice retainage" in its consolidated statement of
operations ("display method"). Due to changes in the terms of the management
agreements related to the Long Island and Boston Network Sites, effective in
October 1997 and January 1998, respectively, the Company no longer displays the
patient services revenue of the Long Island and Boston Medical Practices. As a
result, the Company no longer displays the patient services revenue and Medical
Practice retainage related to these Network Sites in the accompanying
consolidated statement of operations for the periods prior to January 1, 1998.
The revised management agreements provide for the Company to receive a specific
management fee which the Company has reported in "Revenues, net" in the
accompanying consolidated statement of operations.
These consolidated financial statements are prepared in accordance with
generally accepted accounting principles which requires the use of management's
estimates. The preparation of financial statements in conformity with generally
6
<PAGE>
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting period. Actual results could differ from those estimates.
Revenue and cost recognition -
Reproductive Science Center Division ("RSC Division")
During the first quarter of 1998, the RSC Division's operations were
comprised of eleven management agreements, one of which was entered into in
mid-March 1998.
Under eight of the agreements, including the revised management agreement
for the Boston Network Site, the Company receives as compensation for its
management services a three-part management fee comprised of: (i) a fixed
percentage of net revenues generally equal to 6%, (ii) reimbursed cost of
services (costs incurred in managing a Medical Practice and any costs paid on
behalf of the Medical Practice) and (iii) a fixed or variable percentage of
earnings after management fees and any guaranteed physician compensation, or an
additional fixed or variable percentage of net revenues which generally results
in the Company receiving up to an additional 9.5% of net revenues. Under the
revised management agreement for the Long Island Network Site, as compensation
for its management services, the Company receives a fixed fee (currently equal
to $525,000 per annum), plus reimbursed costs of services.
Two of the Company's Network Sites are affiliated with medical centers.
Under one of these management agreements, the Company primarily provides
endocrine testing and administrative and finance services for a fixed percentage
of revenues, equal to 15% of net revenues, and reimbursed costs of services.
Under the second of these management agreements, the Company's revenues are
derived from certain ART laboratory services performed, and directly billed to
the patients by the Company; out of these patient service revenues, the Company
pays its direct costs and the remaining balance represents the Company's Network
Site contribution. All direct costs incurred by the Company are recorded as
costs of services.
All management fees are reported as "Revenues, net" by the Company. Direct
costs incurred by the Company in performing its management services and costs
incurred on behalf of the Medical Practices are recorded in operating expenses
incurred on behalf of Network Sites. The physicians receive as compensation all
remaining earnings after payment of the Company's management fee.
Prior to January 1, 1998, under another form of management agreement which
had been in use at the Long Island and Boston Network Sites, the Company
recorded all patient service revenues and, out of such revenues, the Company
paid the Medical Practices' expenses, physicians' and other medical
compensation, direct materials and certain hospital contract fees. Specifically,
under the management agreement for the Boston Network Site, the Company
guaranteed a minimum physician compensation based on an annual budget jointly
determined by the Company and the physicians. Remaining revenues, if any, which
represented the Company's management fees, were used by the Company for other
direct administrative expenses which were recorded as costs of services. Under
the management agreement for the Long Island Network Site, the Company's
management fee was payable only out of remaining revenues, if any, after the
payment of all expenses of the Medical Practice. Under these arrangements, the
Company had been liable for payment of all liabilities incurred by the Medical
Practices and had been at risk for any losses incurred in the operation thereof.
Due to changes in the management agreements related to the Long Island and
Boston Network Sites, effective in October 1997 and January 1998, respectively,
the Company no longer displays patient service revenues of the Long Island and
Boston Medical Practices which had been reflected in "Revenues, net" in the
Company's consolidated statement of operations. The revised management
agreements provide for the Company to receive a specific management fee which
the Company will report in "Revenues, net" in its consolidated statement of
operations. Under the revised management agreement for the Long Island Network
Site, as compensation for its management services, the Company receives a fixed
fee (currently equal to $525,000 per annum), plus reimbursed costs of services.
Under the revised management agreement for the Boston Network Site, as
compensation for its management services, the Company receives a three-part
management fee consistent with the majority of the Company's existing management
agreements. The revised agreements provide for increased incentives and
risk-sharing for the Company's affiliated medical providers.
7
<PAGE>
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
AWM Division
The AWM Division's operations are currently comprised of one Network Site
with two locations which are directly owned by the Company and a 51% interest in
the National Menopause Foundation ("NMF"), a company which develops multifaceted
educational programs regarding women's healthcare. The Network Site is also
involved in clinical trials with major pharmaceutical companies.
The Company bills and records all patient service revenues of the Network
Site and records all direct costs incurred as costs of services. The Company
retains as Network Site contribution an amount determined using the three-part
management fee calculation described above with regard to the RSC Division, and
the balance is paid as compensation to the medical providers and is recorded by
the Company in costs of services rendered. The medical providers receive a fixed
monthly draw which may be adjusted quarterly by the Company based on the
respective Network Site's actual operating results.
Revenues in the AWM Division also include amounts earned under contracts
relating to clinical trials between the Network Site and various pharmaceutical
companies. The Network Site contracts with major pharmaceutical companies
(sponsors) to perform women's medical care research mainly to determine the
safety and efficacy of a medication. Research revenues are recognized pursuant
to each respective contract in the period which the medical services (as
stipulated by the research study protocol) are performed and collection of such
fees is considered probable. Net realization is dependent upon final approval by
the sponsor that procedures were performed according to study protocol. Payments
collected from sponsors in advance for services are included in accrued
liabilities, and costs incurred in performing the research studies are included
in costs of services rendered.
The Company's 51% interest in NMF is included in the Company's consolidated
financial statements. The Company records 100% of the patient service revenues
and costs of NMF and reports 49% of any profits of NMF as minority interest on
the Company's consolidated balance sheet. Minority interest at March 31, 1998
and December 31, 1997 was $0.
Patient accounts receivable--
Patient accounts receivable represent receivables from patients for medical
services provided by the Medical Practices. Such amounts are recorded net of
contractual allowances and estimated bad debts. As of March 31, 1998 and
December 31, 1997, of total patient accounts receivable of $10.8 million and
$7.1 million, respectively, approximately $10.3 million and $4.5 million of
patient accounts receivable were a function of Network Site revenue (i.e., the
Company purchased the accounts receivable from the Medical Practice (the
"Purchased Receivables")) and the remaining balances of $514,000 and $2.6
million, respectively, were a function of net revenues of the Company (see --
"Revenue and cost recognition" above). Risk of loss in connection with
non-collectiblity of Purchased Receivables is partially borne by the Company in
an amount generally equal to the percentage of revenues and/or earnings paid to
the Company from the Medical Practice as its management fee. Risk of loss in
connection with non-collectibility of patient accounts receivable which are a
function of net revenues of the Company is borne by the Company.
Management fees receivable --
Management fees receivable represent fees owed to the Company pursuant to
its management agreements with certain Medical Practices (see -- "Revenue and
cost recognition" above).
Research fees receivable --
Research fees receivable represent receivables from pharmaceutical
companies for medical services provided by the Medical Practices at the Network
Site under the AWM Division to patients pursuant to protocols stipulated under
contracts relating to clinical trials between the pharmaceutical companies and
the AWM Division.
8
<PAGE>
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
Intangible assets --
Intangible assets at March 31, 1998 and December 31, 1997 consisted of
the following (000's omitted):
March 31, December 31,
---------- ------------
1998 1997
---------- ------------
Exclusive management rights........... $22,793 $15,539
Goodwill.............................. 3,667 3,890
Trademarks............................ 395 395
------- -------
Total............................ 26,855 19,824
Less-- accumulated amortization....... (1,612) (1,379)
------- -------
Total............................ $25,243 $18,445
======= =======
Exclusive Management Rights, Goodwill and Other Intangible Assets
Exclusive management rights, goodwill and other intangible assets represent
costs incurred by the Company for the right to manage and/or acquire certain
Network Sites and are valued at cost less accumulated amortization.
Trademarks
Trademarks represent trademarks, service marks, trade names and logos
purchased by the Company and are valued at cost less accumulated amortization.
Amortization and recoverability
The Company periodically reviews its intangible assets to assess
recoverability; any impairments would be recognized in the consolidated
statement of operations if a permanent impairment were determined to have
occurred. Recoverability of intangibles is determined based on undiscounted
expected earnings from the related business unit or activity over the remaining
amortization period. Exclusive management rights are amortized over the term of
the respective management agreement, usually ten to twenty-five years. Goodwill
and other intangibles are amortized over periods ranging from three to forty
years. Trademarks are amortized over five to seven years. Accumulated
amortization of exclusive management rights, goodwill and trademarks was
$973,000, $334,000 and $305,000 at March 31, 1998, respectively, and was
$802,000, $283,000 and $294,000 at December 31, 1997, respectively.
Due to Medical Practices --
Due to Medical Practices primarily represents amounts owed by the Company
to the Medical Practices for the medical providers' share of the respective
Medical Practice earnings net of the Company's advances to the Medical Practice,
if any. Due to Medical Practices excludes amounts owed by the Company to Medical
Practices for exclusive management rights.
Earnings per share --
The Company determines earnings (loss) per share in accordance with
Financial Accounting Standards No. 128, "Earnings Per Share" (FAS 128) which the
Company adopted in December 1997. All historical earnings (loss) per share have
been presented in accordance with FAS 128.
9
<PAGE>
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 3 -- REVENUES AND NETWORK SITES' CONTRIBUTION:
The following table sets forth for the three months ended March 31, 1998
and 1997, Revenues, net and Network Sites' contribution for each of the
Company's four types of management agreements (three-part management fee,
percent of revenues plus reimbursed operating expenses, fixed fee plus
reimbursed operating expenses, and patient service revenues) and Revenues, net
and Network Sites' contribution for the AWM Division (000's omitted):
<TABLE>
<CAPTION>
For the
three-month period
ended March 31,
-------------------
1998 1997
------ ------
Revenues, net:
<S> <C> <C>
RSC Division --
Management fees-- three-part management fee (1)....................... $6,305 $1,176
Management fees-- percent of revenues plus reimbursed operating
expenses of the New Jersey Network Site............................. 1,002 879
Management fees-- fixed fee plus reimbursed operating expenses for
the Long Island Network Site (2).................................... 791 --
Patient service revenues (1), (2)..................................... 242 1,969
------ ------
Total RSC Division................................................ 8,340 4,024
AWM Division............................................................ 406 668
------ ------
Total revenues, net............................................... $8,746 $4,692
====== ======
Network Sites' contribution
RSC Division --
Management fees..................................................... $1,866 $ 536
Patient service revenues............................................ 35 470
------ ------
Total RSC Division................................................ 1,901 1,006
------ ------
AWM Division............................................................ (164) 71
------ ------
Total Network Sites' contribution................................. $1,737 $1,077
====== ======
(1) Historically, revenues from the Boston Network Site have consisted of
patient service revenues. Effective January 1, 1998, due to changes in
the management agreement related to the Boston Network Site, revenues
from this site consist of a three-part management fee.
(2) Historically, revenues from the Long Island Network Site have consisted
of patient service revenues. Effective October 1, 1997, due to changes in
the management agreement related to the Long Island Network Site,
revenues from this site consist of a fixed management fee plus reimbursed
cost of services.
</TABLE>
10
<PAGE>
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the three months ended March 31, 1998 and 1997, the FCI, Boston and New
Jersey Network Sites provided greater than 10% of the Company's Revenues, net
and Network Sites' contribution as follows:
<TABLE>
<CAPTION>
Percent of Company Percent of Network
Revenues, net Sites' contribution
for the three-month for the three-month
period ended March 31, period ended March 31,
---------------------- ----------------------
1998 1997 1998 1997
----- ----- ----- -----
<S> <C> <C> <C> <C>
FCI....................................... 28.70% N/A 35.81% N/A
Boston.................................... 16.82% 29.76% 25.56% 38.25%
New Jersey................................ 11.46% 18.74% 31.89% 49.21%
</TABLE>
NOTE 4 -- NOTE PAYABLE:
In November 1996, the Company obtained a $1.5 million revolving credit
facility (the "Credit Facility") issued by First Union National Bank (the
"Bank"). Borrowings under the Credit Facility bear interest at the Bank's prime
rate plus 0.75% per annum, which at March 31, 1998, was 9.25%. The Credit
Facility terminates on July 1, 1998 and is secured by the Company's assets. At
March 31,1998 and December 31, 1997, $1.5 million and $250,000, respectively,
were outstanding under the Credit Facility.
On November 13, 1997, the Company entered into a $4.0 million non-restoring
line of credit dated November 13, 1997 with the Bank (the "Second Credit
Facility"). Borrowings under the Second Credit Facility bear interest at the
Bank's prime rate plus 1% per annum. Accrued interest only on borrowings is
payable commencing December 1, 1997 and all principal and accrued interest is
due and payable on April 30, 1999. The Second Credit Facility is cross
collateralized and cross-defaulted with the Credit Facility and is secured by
the Company's assets. As of March 31, 1998 and December 31, 1997, $750,000 and
$0, respectively, were outstanding under the Second Credit Facility.
As part consideration for the acquisition of the capital stock of Shady
Grove Fertility Centers, Inc., the Company issued $1.1 million in promissory
notes which are payable in two equal annual installments, due on April 1, 1999
and 2000, respectively, and bear interest at an annual rate of 8.5%. Also
included in notes payable is approximately $1.5 million which represents the
amount owed by the Company to acquire the balance of the capital stock of Shady
Grove Fertility Centers, Inc., on or about November 1, 1998 (see Note 6).
NOTE 5 -- EQUITY:
During the first quarter of 1998, the Company consummated an equity private
placement of $5.5 million with entities affiliated with Morgan Stanley Venture
Partners providing for the purchase of 3,235,294 shares of the Company's Common
Stock at a price of $1.70 per share and 240,000 warrants to purchase shares of
the Company's Common Stock, at a nominal exercise price. The Company used or
will use approximately half of these funds to acquire the capital stock of Shady
Grove Fertility Centers, Inc.
In March and April 1998, pursuant to amendments to the Bay Area, FCI and
Shady Grove management agreements, the Company issued warrants to purchase an
aggregate of 150,000 shares of Common Stock, at a weighted average exercise
price of $1.77 per share to the shareholder physicians of the respective medical
practices in exchange for an extension of the term of the Company's respective
management agreements from twenty to twenty-five years.
NOTE 6 -- RECENT ACQUISITIONS:
In January 1998, the Company completed its second in-market merger with the
addition of two physicians to the FCI practice. The Company acquired certain
assets of Advocate Medical Group, S.C. ("AMG") and Advocate MSO, Inc. and
acquired the right to manage AMG's infertility practice conducted under the name
Center for Reproductive Medicine ("CFRM"). Simultaneous with the consummation of
this transaction, the Company amended its management agreement with FCI to
include two of the three physicians practicing under the name CFRM. The
11
<PAGE>
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
aggregate purchase price was approximately $1.5 million, consisting of
approximately $1.2 million in cash and 184,314 shares of Common Stock. The
majority of the purchase price was allocated to exclusive management rights.
On March 12, 1998, the Company acquired the majority of the capital stock
of Shady Grove Fertility Centers, Inc. ("Shady Grove"), currently a Maryland
business corporation which provides management services, and formerly a Maryland
professional corporation engaged in providing infertility services. Prior to the
consummation of the transaction, Shady Grove had entered into a twenty-year
management agreement with Levy, Sagoskin and Stillman, M.D., P.C. (the " Shady
Grove P.C."), an infertility physician group practice comprised of six
physicians and four locations surrounding the greater Washington, D.C. area. The
Company will acquire the balance of the Shady Grove capital stock on or about
November 1, 1998. The aggregate purchase price for all of the Shady Grove
capital stock was approximately $5.7 million, consisting of approximately $2.8
million in cash, $1.4 million in Common Stock, and $1.5 million in promissory
notes. The purchase price was allocated to the various assets and liabilities
assumed and the balance was allocated to exclusive management rights. On March
12, 1998, the Closing Date, the following consideration was paid: (i)
approximately $1.8 million in cash, (ii) approximately $1.2 million in stock or
639,551 shares of Common Stock, and (iii) approximately $1.1 million in
promissory notes. The Company will pay the balance of the aggregate purchase
price on or about November 1, 1998 (the "Second Closing Date"), when the balance
of the Shady Grove capital stock is transferred to the Company. The $1.1 million
of promissory notes currently outstanding are payable in two equal annual
installments due on April 1, 1999 and 2000, respectively, and bear interest at
an annual rate of 8.5%. The number of shares of Company Common Stock to be
issued on the Second Closing Date, which will have a fair market value of
approximately $200,000, will be determined based upon the average closing price
of the Company's Common Stock for the ten-day trading period prior to the third
business day before the Second Closing Date, provided, however, that in no event
will the price per share exceed $2.00 or be less than $1.70 for purposes of this
calculation.
The following unaudited pro forma results of operations for the three-month
periods ended March 31, 1998 and 1997 have been prepared by management based on
the unaudited financial information for Shady Grove, the Maryland professional
corporation, which management arrangement was entered into in March 1998, and
Fertility Centers of Illinois, S.C. which management agreement was entered into
in August 1997, adjusted where necessary, with respect to pre-acquisition
periods, to the basis of accounting used in the historical financial statements
of the Company. Such adjustments include modifying the results to reflect
operations as if the Shady Grove management agreement had been consummated on
January 1, 1998 and 1997, respectively, and as if the FCI management agreement
had been consummated on January 1, 1997. Additional general corporate expenses
which would have been required to support the operations of the new Network
Sites are not included in the pro forma results. The unaudited pro forma results
may not be indicative of the results that would have occurred if the management
agreement had been in effect on the dates indicated or which may be obtained in
the future.
For the three-month
periods ended March 31,
(000's omitted)
-----------------------
1998 1997
--------- --------
(unaudited)
Revenues, net......................................... $10,265 $7,136
Income before income taxes (1)........................ $ 477 $ 297
Net income............................................ $ 388 $ 230
Basic earnings per share of Common Stock.............. $ 0.02 $ 0.02
Diluted earnings per share of Common Stock............ $ 0.02 $ 0.02
(1) Income before income taxes includes approximately $278,000 and $274,000 of
amortization of exclusive management rights and goodwill in 1998 and 1997,
respectively.
12
<PAGE>
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE 7 -- EARNINGS PER SHARE:
The reconciliation of the numerators and denominators of the basic and
diluted EPS computations for the three-month periods ended March 31, 1998 and
1997 is as follows (000's omitted, except for per share amounts):
<TABLE>
<CAPTION>
1998 1997
---------------------------------- ----------------------------------
Income Shares Per-Share Income Shares Per-Share
(Numerator) (Denominator) Amount (Numerator)(Denominator) Amount
----------- ------------- ------ ----------- ------------ ------
<S> <C> <C> <C> <C> <C> <C>
Net income (loss)............ $210 $(45)
Less: Preferred stock
dividends accrued......... (33) (33)
---- ----
Basic EPS
Income (loss) available to
Common stockholders....... $177 20,024 $0.01 $(78) 9,544 $(0.01)
==== ====== ===== ==== ===== ======
Effect of Dilutive Securities
Options...................... -- 168 -- --
Warrants..................... -- 209 -- --
---- ------ ---- -----
Diluted EPS (1)
Income (loss) available to
Common stockholders + assumed
conversions............... $177 20,401 $0.01 $(78) 9,544 $(0.01)
==== ====== ===== ==== ===== ======
</TABLE>
Options to purchase 1,013,991 shares of Common Stock and warrants to
purchase 367,266 shares of Common Stock at prices ranging from $2.03 to $3.75
per share and from $9.02 to $10.34 per share, respectively, were outstanding as
of March 31, 1998 but were not included in the computation of diluted EPS
because the exercise price of the options and warrants was greater than the
average market price of the shares of Common Stock.
For the three-month period ended March 31, 1998, the 593,006 shares of
Common Stock from the assumed conversion of Preferred Stock are excluded in
computing the diluted per share amount as they are antidilutive.
For the three-month period ended March 31, 1997, the effect of the assumed
exercise of options to purchase 1,133,783 shares of Common Stock at a weighted
average exercise price of $1.86 per share and warrants to purchase 370,377
shares of Common Stock at prices ranging from $1.25 to $13.79 per share, and
265,030 shares of Common Stock from the assumed conversion of Preferred Stock
are excluded in computing the diluted per share amount as they are antidilutive.
NOTE 8 -- SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION AND NON-CASH
TRANSACTIONS:
In connection with its acquisition of the exclusive right to manage CFRM in
January 1998, the Company issued 184,314 shares of Common Stock with an
aggregate fair value equal to approximately $300,000.
In connection with its acquisition of the exclusive right to manage the
Shady Grove P.C., in March 1998, the Company issued 639,551 shares of Common
Stock with an aggregate fair value equal to approximately $1.2 million and
approximately $1.1 million in promissory notes. The Company also recorded an
13
<PAGE>
INTEGRAMED AMERICA, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)
(unaudited)
additional debt obligation of approximately $1.5 million which represents the
amount owed to acquire the balance of the capital stock of Shady Grove, which
should occur on or about November 1, 1998.
In connection with its acquisition of the exclusive right to manage Bay
Area Fertility in January 1997, the Company issued 333,333 shares of Common
Stock with an aggregate fair value equal to approximately $500,000.
In March and April 1998, pursuant to amendments to the Bay Area, FCI and
Shady Grove management agreements, the Company issued warrants to purchase an
aggregate 150,000 shares of the Company's Common Stock at a weighted average
exercise price of $1.77 per share to the shareholder physicians of the
respective medical practices in exchange for an extension of the term of the
Company's respective managements agreement from twenty to twenty-five years.
In the three-month period ended March 31, 1997, the Company entered into a
capital lease obligation in the amount of $105,000 for medical equipment.
Accrued dividends on Convertible Preferred Stock outstanding increased by
$33,000 to $497,000 and by $33,000 to $364,000, in the three-month periods ended
March 31, 1998 and 1997, respectively.
State taxes, which primarily reflect various state income taxes, of $76,000
and $2,000 were paid in the three-month periods ended March 31, 1998 and 1997,
respectively.
Interest paid in cash in the three-month periods ended March 31, 1998 and
1997 amounted to $72,000 and $11,000, respectively. Interest received in the
three-month periods ended March 31, 1998 and 1997 amounted to $12,000 and
$34,000, respectively.
14
<PAGE>
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations
The following discussion and analysis should be read in conjunction with
the consolidated financial statements and notes thereto included in this
quarterly report and with the Company's Annual Report on Form 10-K for the year
ended December 31, 1997.
Overview
During the first quarter of 1998, the Company consummated an equity private
placement of $5.5 million with entities affiliated with Morgan Stanley Venture
Partners providing for the purchase of 3,235,294 shares of the Company's Common
Stock at a price of $1.70 per share and 240,000 warrants to purchase shares of
the Company's Common Stock, at a nominal exercise price. Approximately half of
these funds were or will be used by the Company to purchase the capital stock of
Shady Grove Fertility Centers, Inc. ("Shady Grove") and the right to manage
Levy, Sagoskin and Stillman M.D., P.C. (the "Shady Grove P.C.") an infertility
physician group practice comprised of six physicians and four locations in the
greater Washington, D.C. area. The Shady Grove management agreement represents
the second most significant management agreement entered into by the Company to
date.
Since inception through December 31, 1997, the management agreements
related to the Long Island and Boston Network Sites have been incorporated in
the Company's consolidated financial statements via the display method as the
Company believed that these management agreements provided it with a "net
profits or equivalent interest" in the net profits of the medical services
furnished by the Medical Practices at the Long Island and Boston Network Sites.
Consequently, for the Long Island and Boston Network Sites, the Company has
historically presented the Medical Practices' patient services revenue, less
amounts retained by the Medical Practices, or "Medical Practice retainage", as
"Revenues after Medical Practice retainage" in its consolidated statement of
operations ("display method"). Due to changes in the management agreements
related to the Long Island and Boston Network Sites effective in October 1997
and January 1998, respectively, the Company no longer displays the patient
services revenue of the Long Island and Boston Medical Practices. As a result,
the Company no longer displays the patient services revenue and Medical Practice
retainage related to these Network Sites in the accompanying consolidated
statement of operations for the periods prior to January 1, 1998. The revised
management agreements provide for the Company to receive a specific management
fee which the Company has reported in "Revenues, net" in the accompanying
consolidated statement of operations. The revised agreements provide for
increased incentives and risk-sharing for the Company's affiliated Medical
Practices.
The RSC Division currently consists of eleven Network Sites. During the
three-month period ended March 31, 1998, the RSC Division derived its revenues
pursuant to eleven management agreements, including two of which were entered
into subsequent to the first quarter in 1997. During the three-month period
ended March 31, 1997, the RSC Division principally derived its revenues pursuant
to eight management agreements.
Results of Operations
Three Months Ended March 31, 1998 Compared to Three Months Ended March 31, 1997
Revenues, net for the three months ended March 31, 1998 (the "first quarter
of 1998") were approximately $8.7 million as compared to approximately $4.7
million for the three months ended March 31, 1997 (the "first quarter of 1997"),
an increase of 86.4%. In the first quarter of 1998, the Company's RSC Division
and AWM Division contributed 95.4% and 4.6%, respectively, of the Company's
total revenues compared to 85.8% and 14.2%, respectively, in the first quarter
of 1997.
15
<PAGE>
RSC Division revenues for the first quarter of 1998 more than doubled to
approximately $8.3 million as compared to $4.0 million for the first quarter of
1997. For the first quarter of 1998, revenues at Network Sites existing in the
comparable period in 1997 increased by 28.1%, due to increases in volume
primarily attributable to new service offerings at certain Network Sites.
Revenues under the RSC Division were comprised of (i) three-part management
fees, (ii) management fees based on a percentage of revenues and reimbursed
costs of services, (iii) management fees based on a fixed fee plus reimbursed
costs of services, and (iv) patient service revenues. Three- part management fee
revenues were approximately $6.3 million in the first quarter of 1998 compared
to approximately $1.2 million in the first quarter of 1997. The significant
increase in three-part management fee revenues was attributable to new
management agreements entered into in the first quarter of 1998 and the second
and the third quarters of 1997, and to the change in the Boston Network Site
management agreement pursuant to which the Company's compensation was revised to
consist of a three-part management fee as opposed to patient service revenues.
Management fees based on a percentage of revenues and reimbursed costs of
services were approximately $1.0 million in the first quarter of 1998 compared
to approximately $879,000 in the first quarter of 1997, an increase of 14.0%,
due to an increase in volume. Management fees based on a fixed fee plus
reimbursed costs of services were approximately $791,000 in the first quarter of
1998 compared to $0 in the first quarter of 1997 due to the change in the Long
Island Network Site management agreement pursuant to which the Company's
compensation was revised to consist of a fixed fee plus reimbursed costs of
services as opposed to patient service revenues. Patient service revenues
decreased to approximately $242,000 in the first quarter of 1998 compared to
approximately $2.0 million for the first quarter of 1997 due to the changes in
the terms of the Company's management agreements related to the Long Island and
Boston Network Sites. AWM Division revenues for the first quarter of 1998 were
approximately $406,000 as compared to $668,000 for the first quarter of 1997, a
decrease of 39.2%, due to lower volume.
Operating expenses incurred on behalf of the Network Sites nearly doubled
to approximately $7.0 million in the first quarter of 1998 as compared to
approximately $3.6 million in the first quarter of 1997. This increase was
primarily attributable to new management agreements entered into in the first
quarter of 1998 and the second and the third quarters of 1997 under the RSC
Division. This increase was also partly attributable to additional costs
associated with increases in volume at existing Network Sites. As a percentage
of Revenues, net, operating expenses increased to 80.1% in the first quarter of
1998 as compared to 77.0% in the first quarter of 1997, primarily due to the
decrease in revenues from the AWM Division and to the higher cost structures
currently existing at the Network Sites established in the second and third
quarters of 1997 and the first quarter of 1998.
Network Sites' contribution was approximately $1.7 million in the first
quarter of 1998 as compared to $1.1 million in the first quarter of 1997, an
increase of approximately 61.3%, as a result of new management agreements
entered into in the first quarter of 1998 and the second and the third quarters
of 1997 and to the increases in revenues at existing Network Sites. As a
percentage of revenues, Network Sites' contribution decreased to 19.9% in the
first quarter of 1998 as compared to 23.0% in the first quarter of 1997, due to
the negative contribution to earnings from operations at the AWM Division and
the higher cost structures currently existing at the Network Sites established
in the second and third quarters of 1997 and the first quarter of 1998.
General and administrative expenses for the first quarter of 1998 were
approximately $1.2 million as compared to approximately $977,000 million in the
first quarter of 1997, an increase of 21.3%. As a percentage of revenues,
general and administrative expenses decreased to approximately 13.5% from
approximately 21.0% due to the increase in revenues discussed above.
Amortization of intangible assets was $233,000 in the first quarter of 1998
as compared to $137,000 in the first quarter of 1997. This increase was
attributable to the Company's acquisitions in the first quarter of 1998 and the
second and third quarters of 1997.
Interest income for the first quarter of 1998 decreased to $12,000 from
$34,000 for the first quarter of 1997, due to a lower cash balance. Interest
expense for the first quarter of 1998 increased to $72,000 from $10,000 in the
first quarter of 1997, primarily due to an increase in bank borrowings.
The provision for income taxes primarily reflected various state income
taxes in the first quarter of 1998 and in the first quarter of 1997,
respectively.
Net income was $210,000 in the first quarter of 1998 as compared to a net
loss of $45,000 in the first quarter of 1997. This net income was primarily due
to a $660,000 increase in Network Site contribution, partially offset by a
$208,000 increase in general and administrative expenses, a $96,000 increase in
amortization of intangible assets and a $84,000 increase in net interest
expenses.
16
<PAGE>
Liquidity and Capital Resources
Historically, the Company has financed its operations primarily through
sales of equity securities. More recently, the Company has commenced using bank
financing for working capital and acquisition purposes. The Company anticipates
that its acquisition strategy will continue to require substantial capital
investment. Capital is needed not only for additional acquisitions, but also for
the effective integration, operation and expansion of the Company's existing
Network Sites. The Medical Practices may require capital for renovation and
expansion and for the addition of medical equipment and technology. The Company
is in the process of seeking to obtain a line of credit to fund its acquisition
strategy over the next year.
During the first quarter of 1998, the Company consummated an equity private
placement of $5.5 million with entities affiliated with Morgan Stanley Venture
Partners providing for the purchase of 3,235,294 shares of the Company's Common
Stock at a price of $1.70 per share and 240,000 warrants to purchase shares of
the Company's Common Stock, at a nominal exercise price. Approximately half of
these funds were or will be used by the Company to purchase the capital stock of
Shady Grove and the right to manage the Shady Grove P.C.'s infertility medical
practice. The balance of these funds have been and will continue to be used for
working capital purposes.
At March 31, 1998, the Company had working capital of approximately $7.1
million, approximately $2.4 million of which consisted of cash and cash
equivalents, compared to working capital of approximately $4.1 million at
December 31, 1997, approximately $1.9 million of which consisted of cash and
cash equivalents. The net increase in working capital at March 31, 1998 was
principally due to the $5.5 million proceeds received from the equity private
placement with Morgan Stanley, an approximate $2.4 million increase in net
patient accounts receivable, and an approximate $1.4 million decrease in
accounts payable, partially offset by approximately $3.1 million in payments for
exclusive management rights, an approximate $1.8 million increase in short-term
debt related to the Shady Grove transaction, an approximate $455,000 increase in
Due to Medical Providers, and payments of $438,000 for the purchase of fixed
assets and leasehold improvements related to new and existing Network Sites.
During the first quarter of 1998, the Company completed its second
in-market merger with the addition of two physicians to the FCI practice and
entered into one new management agreement with the Shady Grove, P.C. The
aggregate purchase price of these transactions, exclusive of acquisition costs,
was approximately $7.2 million, consisting of approximately $4.0 million in
cash, $1.5 million in promissory notes, 823,865 shares of the Company's Common
Stock, and approximately an additional $200,000 in shares of the Company's
Common Stock. A portion of the aggregate purchase price related to the Shady
Grove acquisition will be paid in November 1998 as follows: approximately $1.0
million in cash, $403,000 in promissory notes and approximately $200,000 in
shares of the Company's Common Stock. The $1.1 million of promissory notes
currently outstanding are payable in two equal annual installments, due on April
1, 1999 and 2000, respectively, and bear interest at an annual rate of 8.5%. The
number of shares of Common Stock of the Company to be issued in November 1998
will be determined based upon the average closing price of the Company's Common
Stock for the ten-day trading period prior to the third business day before the
Second Closing Date, provided, however, that in no event will the price per
share exceed $2.00 or be less than $1.70 for purposes of this calculation.
As of March 31, 1998, under three of its management agreements, the Company
is obligated to advance funds to the Medical Practices to provide a minimum
physician draw (up to an aggregate of approximately $465,000 in 1998) and to
provide new services, utilize new technologies, fund projects, purchase the net
accounts receivable of the Medical Practices and for other purposes. Any
advances are to be repaid monthly and will bear interest at the prime rate used
by the Company's primary bank in effect at the time of the advance.
As of March 31, 1998, the entire balance of the Company's $1.5 million
credit facility dated November 21, 1996 (the "Credit Facility") with First Union
National Bank (the "Bank") was outstanding. Borrowings under the Credit Facility
bear interest at the Bank's prime rate plus 0.75% per annum. The Credit Facility
terminates on July 1, 1998 and is secured by the Company's assets.
On November 13, 1997, the Company entered into a $4.0 million non-restoring
line of credit with the Bank (the "New Credit Facility"). Borrowings under the
17
<PAGE>
New Credit Facility bear interest at the Bank's prime rate plus 1% per annum.
Accrued interest only on borrowings is payable commencing December 1, 1997 and
all principal and accrued interest is due and payable on April 30, 1999. The New
Credit Facility is cross collateralized and cross- defaulted with the Credit
Facility and is secured by the Company's assets. As of March 31, 1998, $750,000
was outstanding under the New Credit Facility.
As of March 31, 1998, dividend payments of $497,000 on the Series A
Cumulative Convertible Preferred Stock (the "Convertible Preferred Stock") were
in arrears. The Company does not anticipate the payment of any dividends on the
Convertible Preferred Stock in the foreseeable future.
Fluctuations in Quarterly Results
The Company's revenues are typically lower during the first quarter of the
Company's fiscal year. This lower level of revenues is primarily attributable to
the commencement of fertility treatment by the patients of the Medical Practices
at the beginning of the calendar year. Quarterly results also may be materially
affected by the timing of acquisitions and the timing and magnitude of costs
related to acquisitions. Therefore, results for any quarter are not necessarily
indicative of the results that the Company may achieve for any subsequent fiscal
quarter or for a full fiscal year.
Forward Looking Statements
This Form 10-Q and discussions and/or announcements made by or on behalf of
the Company, contain certain forward-looking statements within the meaning of
the "safe harbor" provisions of the Private Securities Litigation Reform Act of
1995, the attainment of which involve various risks and uncertainties.
Forward-looking statements may be identified by the use of forward-looking
terminology such as, "may," "will," "expect," "believe," "estimate,"
"anticipate," "continue," or similar terms, variations of those terms or the
negative of those terms. The Company's actual results may differ materially from
those described in these forward-looking statements due to the following
factors: the Company's ability to acquire additional management agreements,
including the Company's ability to finance future growth, the loss of
significant management agreement(s), the profitability or lack thereof at
Network Sites managed by the Company, the Company's ability to transition sole
practitioners to group practices, the development of the AWM Division, increases
in overhead due to expansion, the exclusion of infertility, ART and other
women's reproductive healthcare services from insurance coverage, government
laws and regulation regarding health care, changes in managed care contracting,
and the timely development of and acceptance of new infertility, ART, genetic
and/or women's healthcare technologies and techniques.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Not applicable.
18
<PAGE>
Part II - OTHER INFORMATION
Item 1. Legal Proceedings.
Not applicable.
Item 2. Changes in Securities.
The following sets forth all of the unregistered sales
of securities by the Company during the first quarter of
1998:
i. In January 1998, the Company amended its management
agreement with FCI to include two of the three
physicians practicing under CFRM (See Note 6). The
aggregate consideration included the issuance of
184,314 shares of Common Stock to the two
physicians who became affiliated with FCI.
ii. In January 1998, the Company consummated an equity
private placement of $5.5 million with entities
(the "Funds") affiliated with Morgan Stanley
Venture Partners providing for the purchase of 3,
235,294 shares of the Company's Common Stock at a
price of $1.70 per share and 240,000 warrants to
purchase shares of the Company's Common Stock, at a
nominal exercise price.
iii. In March 1998, the Company issued warrants to
acquire 60,000 shares of Common Stock at an
exercise price of $1.80 per share to the
shareholders of FCI in consideration of extending
the Company's management agreement with FCI from 20
to 25 years.
iv. In March 1998, the Company consummated the
acquisition of a majority of the capital stock of
Shady Grove Fertility Centers, Inc. As partial
payment of the consideration for the capital stock
acquired, the Company issued 639,551 shares of
Common Stock.
The above transactions were private transactions not
involving a public offering and were exempt from the
registration provisions of the Securities Act of 1933,
as amended, pursuant to Section 4(2) thereof. Except as
otherwise indicated, the sale of securities was without
the use of an underwriter, and the certificates
evidencing the shares bear a restrictive legend
permitting the transfer thereof only upon registration
of the shares or an exemption under the Securities Act
of 1933, as amended.
Item 3. Defaults Upon Senior Securities.
As of March 31, 1998, dividend payments of $497,000 on
the Convertible Preferred Stock were in arrears.
Item 4. Submission of Matters to Vote of Security Holders.
None.
Item 5. Other Information.
In connection with the Company's January 1998 equity
private placement with the Funds, M. Fazle Husain, a
managing member of a general partner of the Funds,
became a member of the Company's Board of Directors
effective January 23, 1998.
Pursuant to the Company's management agreement with
Shady Grove Fertility Centers, Inc., Michael J. Levy,
M.D., an employed shareholder physician of the
affiliated medical practice, became a member of the
Company's Board of Directors effective March 12, 1998.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits.
See Index to Exhibits on pages 21-22.
(b) Reports on Form 8-K.
On March 24, 1998, the Company filed with the
Securities and Exchange Commission a Form 8-K
reporting the Company's acquisition of the majority
of the capital stock of Shady Grove Fertility
Centers, Inc.
19
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
INTEGRAMED AMERICA, INC.
(Registrant)
Date: May 14, 1998 By: /s/ Eugene R. Curcio
--------------------
Eugene R. Curcio
Vice President and
Chief Financial Officer
(Principal Financial and
Accounting Officer)
20
<PAGE>
INDEX TO EXHIBITS
Exhibit
Number Exhibit
4.9 (a) -- Warrant issued to Brian Kaplan, M.D.
4.9 (b) -- Warrant issued to Aaron S. Lifchez, M.D.
4.9 (c) -- Warrant issued to Jacob Moise, M.D.
4.9 (d) -- Warrant issued to Jorge Valle, M.D.
4.10(a) -- Warrant issued to Donald Galen, M.D.
4.10(b) -- Warrant issued to Arnold Jacobson, M.D.
4.10(c) -- Warrant issued to Louis Weckstein, M.D.
4.11(a) -- Warrant issued to Michael J. Levy, M.D.
4.11(b) -- Warrant issued to Arthur W. Sagoskin, M.D.
4.11 (c)-- Warrant issued to Robert J. Stillman, M.D.
10.2 (a)-- Copy of Amendment to Registrant's 1992 Stock Option Plan (4)
10.61(a)-- Amendment No. 1 to Management Agreement between IntegraMed America,
Inc. and Bay Area Fertility and Gynecology Medical Group, Inc.
10.80(a) -- Amendment effective January 29, 1998 to Contract Number
DADA15-96-C-009 between INMD and the Department of the Army, Walter
Reed Army Medical Center for In Vitro Fertilization Laboratory
Services.
10.93 -- Amendment No. 4 to Management Agreement between Registrant and
Fertility Centers of Illinois, S.C. dated January 9, 1998 (1)
10.94 -- Investment Agreement between Registrant and Morgan Stanley Venture
Partners III, L.P.., Morgan Stanley Venture Investors III, L.P. and
the Morgan Stanley Venture Partners Entrepreneur Fund, L.P. (2)
10.95 -- Amendment No. 5 to Management Agreement between Registrant and
Fertility Centers of Illinois, S.C. dated March 5, 1998 (3).
10.96 -- Termination Agreement by and among Women's Medical & Diagnostic
Center, Inc., W. Banks Hinshaw, Jr., Ph.D., M.D., and Robin E.
Markle, M.D. (3)
10.100 -- Asset Purchase and Sale Agreement by and among IntegraMed America,
Inc. and Fertility Centers of Illinois, S.C., Advocate Medical
Group, S.C. and Advocate MSO, Inc. dated January 9, 1998 (3)
10.101 -- Physician Employment Agreement between Fertility Centers of
Illinois, S.C. and Laurence A. Jacobs, M.D. dated January 9, 1998
(3).
10.102 -- Physician Employment Agreement between Fertility Centers of
Illinois, S.C. and John J. Rapisarda, M.D. dated January 9, 1998
(3).
21
<PAGE>
10.103 -- Personal Responsibility Agreement entered into by and among
IntegraMed America, Inc., Fertility Centers of Illinois, S.C. and
John J. Rapisarda, M.D. dated January 9, 1998 (3).
10.104 -- Personal Responsibility Agreement entered into by and among
IntegraMed America, Inc., Fertility Centers of Illinois, S.C. and
Laurence A. Jacobs, M.D. dated January 9, 1998 (3).
10.105 -- Management Agreement between Shady Grove Fertility Centers, P.C.
and Levy, Sagoskin and Stillman, M.D., P.C. dated March 11, 1998
(3).
10.105(a) -- Amendment No. 1 to Management Agreement between Shady Grove
Fertility Centers, Inc. and Levy, Sagoskin and Stillman, M.D.,P.C.
10.106 -- Submanagement Agreement between Shady Grove Fertility Centers, Inc.
and IntegraMed America, Inc. dated March 12, 1998 (3).
10.107 -- Stock Purchase and Sale Agreement among Integramed America, Inc.
and Michael J. Levy, M.D., Robert J. Stillman, M.D. and Arthur W.
Sagoskin, M.D. dated March 12, 1998 (3).
10.108 -- Personal Responsibility Agreement by and among IntegraMed America,
Inc. and Arthur W. Sagoskin, M.D. dated March 12, 1998 (3).
10.109 -- Personal Responsibility Agreement by and among IntegraMed America,
Inc. and Michael J. Levy, M.D. dated March 12, 1998 (3).
10.110 -- Physician-Stockholder Employment Agreement between Levy, Sagoskin
and Stillman, M.D., P.C. and Michael J. Levy, M.D. dated March 11,
1998 (3).
10.111 -- Physician-Stockholder Employment Agreement between Levy, Sagoskin
and Stillman, M.D., P.C. and Arthur W. Sagoskin, M.D. dated March
11, 1998 (3).
10.112 -- Physician-Stockholder Employment Agreement between Levy, Sagoskin
and Stillman, M.D., P.C. and Robert J. Stillman, M.D. dated March
11, 1998 (3).
27 -- Financial Data Schedule
- ----------------------------------------
(1) Filed as Exhibit with identical exhibit number to Schedule 13D dated
February 11, 1998.
(2) Filed as Exhibit with identical exhibit number to registrant's Report on
Form 8-K dated January 23, 1998.
(3) Incorporated by reference to the Exhibit with the identical number to
Registrant's Annual Report on Form 10-K for the year ended December 31,
1997.
(4) Incorporated by reference to the Registrant's Definitive Proxy Statement
filed on May 5, 1998.
22
VOID AFTER 5:00 P.M. NEW YORK TIME, ON MARCH 5, 2003
WARRANT TO PURCHASE 15,000 SHARES OF COMMON STOCK
WARRANT TO PURCHASE COMMON STOCK
OF
INTEGRAMED AMERICA, INC.
This is to Certify That, FOR VALUE RECEIVED, BRIAN KAPLAN, or
assigns ("Holder"), is entitled to purchase, subject to the provisions of this
Warrant, from IntegraMed America, Inc., a Delaware corporation ("Company"),
15,000 fully paid, validly issued and nonassessable shares of Common Stock, par
value $.01 per share, of the Company ("Common Stock") at a price of $1.80 per
share at any time or from time to time during the period from March 6, 1998 to
March 5, 2003, but not later than 5:00 p.m. New York City Time, on March 5,
2003. The number of shares of Common Stock to be received upon the exercise of
this Warrant and the price to be paid for each share of Common Stock may be
adjusted from time to time as hereinafter set forth. The shares of Common Stock
deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as "Warrant Shares" and the exercise price of
a share of Common Stock in effect at any time and as adjusted from time to time
is hereinafter sometimes referred to as the "Exercise Price".
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part
at any time or from time to time on or after March 6, 1998 and until March 5,
2003 (the "Exercise Period"), subject to the provisions of Section (j)(2)
hereof; provided, however, that if such day is a day on which banking
institutions in the State of New York are authorized by law to close, then on
the next succeeding day which shall not be such a day. This Warrant may be
exercised by presentation and surrender hereof to the Company at its principal
office, or at the office of its stock transfer agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form. As soon as
practicable after each such exercise of the warrants, but not later than seven
(7) days from the date of such exercise, the Company shall issue and deliver to
the Holder a certificate or certificate for the Warrant Shares issuable upon
such exercise, registered in the name of the Holder or its designee. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
1
<PAGE>
rights of the Holder thereof to purchase the balance of the Warrant Shares
purchasable thereunder. Upon receipt by the Company of this Warrant at its
office, or by the stock transfer agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a national
securities exchange or admitted to unlisted trading privileges
on such exchange or listed for trading on the Nasdaq National
Market, the current market value shall be the last reported
sale price of the Common Stock on such exchange or market on
the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average
closing bid and asked prices for such day on such exchange or
market; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, but is traded on the Nasdaq
Small Cap Market, the current Market Value shall be the
average of the closing bid and asked prices for such day on
such market and if the Common Stock is not so traded, the
current market value shall be the mean of the last reported
bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to the date of the
exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. This Warrant is not transferable (other than
by will or pursuant to the laws of descent and distribution). Upon surrender of
2
<PAGE>
this Warrant to the Company at its principal office or at the office of its
stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other warrants which
carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as used herein
includes any Warrants into which this Warrant may be divided or exchanged. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and deliver
a new Warrant of like tenor and date. Any such new Warrant executed and
delivered shall constitute an additional contractual obligation on the part of
the Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at law
or equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the happening
of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall
be the number of shares of Common Stock outstanding after
giving effect to such action, and the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise
of each Warrant is adjusted pursuant to Subsection (1) above,
the number of Shares purchasable upon exercise of this Warrant
shall simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
3
<PAGE>
(3) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least five cents ($0.05) in such price;
provided, however, that any adjustments which by reason of
this Subsection (3) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend or
distribution in shares of Common Stock, or any subdivision,
reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities
convertible into Common Stock (including Warrants).
(4) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly but no later than
10 days after any request for such an adjustment by the
Holder, cause a notice setting forth the adjusted Exercise
Price and adjusted number of Shares issuable upon exercise of
each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to
the Holders at their last addresses appearing in the Warrant
Register, and shall cause a certified copy thereof to be
mailed to its transfer agent, if any. The Company may retain a
firm of independent certified public accountants selected by
the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by
this Section (f), and a certificate signed by such firm shall
be conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an
adjustment made pursuant to Subsection (1) above, the Holder
of this Warrant thereafter shall become entitled to receive
any shares of the Company, other than Common Stock, thereafter
the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Common Stock contained
in Subsections (1) to (3), inclusive above.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
4
<PAGE>
including a statementof the number of additional shares of Common Stock, if any,
and such other facts as shall be necessary to show the reason for and the manner
of computing such adjustment. Each such officer's certificate shall be made
available at all reasonable times for inspection by the holder or any holder of
a Warrant executed and delivered pursuant to Section (a) and the Company shall,
forthwith after each such adjustment, mail a copy by certified mail of such
certificate to the Holder or any such holder.
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------------
Gerardo Canet, President & CEO
Dated: ____________, 1998
Attest:
/s/Claude E. White
- -----------------------------
Claude E. White, Secretary
[Seal]
5
<PAGE>
PURCHASE FORM
Date: ________________________
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing _______ shares of Common Stock and
hereby makes payment of _______ in payment of the actual exercise price thereof.
----------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name ________________________________
(Please typewrite or print in block letters)
Address ______________________________
Signature _____________________________
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and transfers unto
Name _____________________________
(Please typewrite or print in block letters)
Address ____________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date:_____________________________
Signature _________________________
<PAGE>
************************************************************************
STOCK PURCHASE WARRANT
To Purchase Common Stock of
INTEGRAMED AMERICA, INC.
************************************************************************
VOID AFTER 5:00 P.M. NEW YORK TIME, ON MARCH 5, 2003
WARRANT TO PURCHASE 15,000 SHARES OF COMMON STOCK
WARRANT TO PURCHASE COMMON STOCK
OF
INTEGRAMED AMERICA, INC.
This is to Certify That, FOR VALUE RECEIVED, AARON S. LIFCHEZ,
or assigns ("Holder"), is entitled to purchase, subject to the provisions of
this Warrant, from IntegraMed America, Inc., a Delaware corporation ("Company"),
15,000 fully paid, validly issued and nonassessable shares of Common Stock, par
value $.01 per share, of the Company ("Common Stock") at a price of $1.80 per
share at any time or from time to time during the period from March 6, 1998 to
March 5, 2003, but not later than 5:00 p.m. New York City Time, on March 5,
2003. The number of shares of Common Stock to be received upon the exercise of
this Warrant and the price to be paid for each share of Common Stock may be
adjusted from time to time as hereinafter set forth. The shares of Common Stock
deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as "Warrant Shares" and the exercise price of
a share of Common Stock in effect at any time and as adjusted from time to time
is hereinafter sometimes referred to as the "Exercise Price".
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part
at any time or from time to time on or after March 6, 1998 and until March 5,
2003 (the "Exercise Period"), subject to the provisions of Section (j)(2)
hereof; provided, however, that if such day is a day on which banking
institutions in the State of New York are authorized by law to close, then on
the next succeeding day which shall not be such a day. This Warrant may be
exercised by presentation and surrender hereof to the Company at its principal
office, or at the office of its stock transfer agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form. As soon as
practicable after each such exercise of the warrants, but not later than seven
(7) days from the date of such exercise, the Company shall issue and deliver to
the Holder a certificate or certificate for the Warrant Shares issuable upon
such exercise, registered in the name of the Holder or its designee. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
1
<PAGE>
rights of the Holder thereof to purchase the balance of the Warrant Shares
purchasable thereunder. Upon receipt by the Company of this Warrant at its
office, or by the stock transfer agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a national
securities exchange or admitted to unlisted trading privileges
on such exchange or listed for trading on the Nasdaq National
Market, the current market value shall be the last reported
sale price of the Common Stock on such exchange or market on
the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average
closing bid and asked prices for such day on such exchange or
market; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, but is traded on the Nasdaq
Small Cap Market, the current Market Value shall be the
average of the closing bid and asked prices for such day on
such market and if the Common Stock is not so traded, the
current market value shall be the mean of the last reported
bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to the date of the
exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. This Warrant is not transferable (other than
by will or pursuant to the laws of descent and distribution). Upon surrender of
2
<PAGE>
this Warrant to the Company at its principal office or at the office of its
stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other warrants which
carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as used herein
includes any Warrants into which this Warrant may be divided or exchanged. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and deliver
a new Warrant of like tenor and date. Any such new Warrant executed and
delivered shall constitute an additional contractual obligation on the part of
the Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at law
or equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the happening
of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall
be the number of shares of Common Stock outstanding after
giving effect to such action, and the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise
of each Warrant is adjusted pursuant to Subsection (1) above,
the number of Shares purchasable upon exercise of this Warrant
shall simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
3
<PAGE>
(3) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least five cents ($0.05) in such price;
provided, however, that any adjustments which by reason of
this Subsection (3) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend or
distribution in shares of Common Stock, or any subdivision,
reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities
convertible into Common Stock (including Warrants).
(4) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly but no later than
10 days after any request for such an adjustment by the
Holder, cause a notice setting forth the adjusted Exercise
Price and adjusted number of Shares issuable upon exercise of
each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to
the Holders at their last addresses appearing in the Warrant
Register, and shall cause a certified copy thereof to be
mailed to its transfer agent, if any. The Company may retain a
firm of independent certified public accountants selected by
the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by
this Section (f), and a certificate signed by such firm shall
be conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an
adjustment made pursuant to Subsection (1) above, the Holder
of this Warrant thereafter shall become entitled to receive
any shares of the Company, other than Common Stock, thereafter
the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Common Stock contained
in Subsections (1) to (3), inclusive above.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
4
<PAGE>
including a statementof the number of additional shares of Common Stock, if any,
and such other facts as shall be necessary to show the reason for and the manner
of computing such adjustment. Each such officer's certificate shall be made
available at all reasonable times for inspection by the holder or any holder of
a Warrant executed and delivered pursuant to Section (a) and the Company shall,
forthwith after each such adjustment, mail a copy by certified mail of such
certificate to the Holder or any such holder.
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------------
Gerardo Canet, President & CEO
Dated: ____________, 1998
Attest:
/s/Claude E. White
- -----------------------------
Claude E. White, Secretary
[Seal]
5
<PAGE>
PURCHASE FORM
Date: ________________________
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing _______ shares of Common Stock and
hereby makes payment of _______ in payment of the actual exercise price thereof.
----------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name ________________________________
(Please typewrite or print in block letters)
Address ______________________________
Signature _____________________________
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and transfers unto
Name _____________________________
(Please typewrite or print in block letters)
Address ____________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date:_____________________________
Signature _________________________
<PAGE>
************************************************************************
STOCK PURCHASE WARRANT
To Purchase Common Stock of
INTEGRAMED AMERICA, INC.
************************************************************************
VOID AFTER 5:00 P.M. NEW YORK TIME, ON MARCH 5, 2003
WARRANT TO PURCHASE 15,000 SHARES OF COMMON STOCK
WARRANT TO PURCHASE COMMON STOCK
OF
INTEGRAMED AMERICA, INC.
This is to Certify That, FOR VALUE RECEIVED, JACOB MOISE, or
assigns ("Holder"), is entitled to purchase, subject to the provisions of this
Warrant, from IntegraMed America, Inc., a Delaware corporation ("Company"),
15,000 fully paid, validly issued and nonassessable shares of Common Stock, par
value $.01 per share, of the Company ("Common Stock") at a price of $1.80 per
share at any time or from time to time during the period from March 6, 1998 to
March 5, 2003, but not later than 5:00 p.m. New York City Time, on March 5,
2003. The number of shares of Common Stock to be received upon the exercise of
this Warrant and the price to be paid for each share of Common Stock may be
adjusted from time to time as hereinafter set forth. The shares of Common Stock
deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as "Warrant Shares" and the exercise price of
a share of Common Stock in effect at any time and as adjusted from time to time
is hereinafter sometimes referred to as the "Exercise Price".
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part
at any time or from time to time on or after March 6, 1998 and until March 5,
2003 (the "Exercise Period"), subject to the provisions of Section (j)(2)
hereof; provided, however, that if such day is a day on which banking
institutions in the State of New York are authorized by law to close, then on
the next succeeding day which shall not be such a day. This Warrant may be
exercised by presentation and surrender hereof to the Company at its principal
office, or at the office of its stock transfer agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form. As soon as
practicable after each such exercise of the warrants, but not later than seven
(7) days from the date of such exercise, the Company shall issue and deliver to
the Holder a certificate or certificate for the Warrant Shares issuable upon
such exercise, registered in the name of the Holder or its designee. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
1
<PAGE>
rights of the Holder thereof to purchase the balance of the Warrant Shares
purchasable thereunder. Upon receipt by the Company of this Warrant at its
office, or by the stock transfer agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a national
securities exchange or admitted to unlisted trading privileges
on such exchange or listed for trading on the Nasdaq National
Market, the current market value shall be the last reported
sale price of the Common Stock on such exchange or market on
the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average
closing bid and asked prices for such day on such exchange or
market; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, but is traded on the Nasdaq
Small Cap Market, the current Market Value shall be the
average of the closing bid and asked prices for such day on
such market and if the Common Stock is not so traded, the
current market value shall be the mean of the last reported
bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to the date of the
exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. This Warrant is not transferable (other than
by will or pursuant to the laws of descent and distribution). Upon surrender of
2
<PAGE>
this Warrant to the Company at its principal office or at the office of its
stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other warrants which
carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as used herein
includes any Warrants into which this Warrant may be divided or exchanged. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and deliver
a new Warrant of like tenor and date. Any such new Warrant executed and
delivered shall constitute an additional contractual obligation on the part of
the Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at law
or equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the happening
of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall
be the number of shares of Common Stock outstanding after
giving effect to such action, and the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise
of each Warrant is adjusted pursuant to Subsection (1) above,
the number of Shares purchasable upon exercise of this Warrant
shall simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
3
<PAGE>
(3) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least five cents ($0.05) in such price;
provided, however, that any adjustments which by reason of
this Subsection (3) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend or
distribution in shares of Common Stock, or any subdivision,
reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities
convertible into Common Stock (including Warrants).
(4) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly but no later than
10 days after any request for such an adjustment by the
Holder, cause a notice setting forth the adjusted Exercise
Price and adjusted number of Shares issuable upon exercise of
each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to
the Holders at their last addresses appearing in the Warrant
Register, and shall cause a certified copy thereof to be
mailed to its transfer agent, if any. The Company may retain a
firm of independent certified public accountants selected by
the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by
this Section (f), and a certificate signed by such firm shall
be conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an
adjustment made pursuant to Subsection (1) above, the Holder
of this Warrant thereafter shall become entitled to receive
any shares of the Company, other than Common Stock, thereafter
the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Common Stock contained
in Subsections (1) to (3), inclusive above.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
4
<PAGE>
including a statementof the number of additional shares of Common Stock, if any,
and such other facts as shall be necessary to show the reason for and the manner
of computing such adjustment. Each such officer's certificate shall be made
available at all reasonable times for inspection by the holder or any holder of
a Warrant executed and delivered pursuant to Section (a) and the Company shall,
forthwith after each such adjustment, mail a copy by certified mail of such
certificate to the Holder or any such holder.
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------------
Gerardo Canet, President & CEO
Dated: ____________, 1998
Attest:
/s/Claude E. White
- -----------------------------
Claude E. White, Secretary
[Seal]
5
<PAGE>
PURCHASE FORM
Date: ________________________
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing _______ shares of Common Stock and
hereby makes payment of _______ in payment of the actual exercise price thereof.
----------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name ________________________________
(Please typewrite or print in block letters)
Address ______________________________
Signature _____________________________
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and transfers unto
Name _____________________________
(Please typewrite or print in block letters)
Address ____________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date:_____________________________
Signature _________________________
<PAGE>
************************************************************************
STOCK PURCHASE WARRANT
To Purchase Common Stock of
INTEGRAMED AMERICA, INC.
************************************************************************
VOID AFTER 5:00 P.M. NEW YORK TIME, ON MARCH 5, 2003
WARRANT TO PURCHASE 15,000 SHARES OF COMMON STOCK
WARRANT TO PURCHASE COMMON STOCK
OF
INTEGRAMED AMERICA, INC.
This is to Certify That, FOR VALUE RECEIVED, JORGE VALLE, or
assigns ("Holder"), is entitled to purchase, subject to the provisions of this
Warrant, from IntegraMed America, Inc., a Delaware corporation ("Company"),
15,000 fully paid, validly issued and nonassessable shares of Common Stock, par
value $.01 per share, of the Company ("Common Stock") at a price of $1.80 per
share at any time or from time to time during the period from March 6, 1998 to
March 5, 2003, but not later than 5:00 p.m. New York City Time, on March 5,
2003. The number of shares of Common Stock to be received upon the exercise of
this Warrant and the price to be paid for each share of Common Stock may be
adjusted from time to time as hereinafter set forth. The shares of Common Stock
deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as "Warrant Shares" and the exercise price of
a share of Common Stock in effect at any time and as adjusted from time to time
is hereinafter sometimes referred to as the "Exercise Price".
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part
at any time or from time to time on or after March 6, 1998 and until March 5,
2003 (the "Exercise Period"), subject to the provisions of Section (j)(2)
hereof; provided, however, that if such day is a day on which banking
institutions in the State of New York are authorized by law to close, then on
the next succeeding day which shall not be such a day. This Warrant may be
exercised by presentation and surrender hereof to the Company at its principal
office, or at the office of its stock transfer agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form. As soon as
practicable after each such exercise of the warrants, but not later than seven
(7) days from the date of such exercise, the Company shall issue and deliver to
the Holder a certificate or certificate for the Warrant Shares issuable upon
such exercise, registered in the name of the Holder or its designee. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
1
<PAGE>
rights of the Holder thereof to purchase the balance of the Warrant Shares
purchasable thereunder. Upon receipt by the Company of this Warrant at its
office, or by the stock transfer agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a national
securities exchange or admitted to unlisted trading privileges
on such exchange or listed for trading on the Nasdaq National
Market, the current market value shall be the last reported
sale price of the Common Stock on such exchange or market on
the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average
closing bid and asked prices for such day on such exchange or
market; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, but is traded on the Nasdaq
Small Cap Market, the current Market Value shall be the
average of the closing bid and asked prices for such day on
such market and if the Common Stock is not so traded, the
current market value shall be the mean of the last reported
bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to the date of the
exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. This Warrant is not transferable (other than
by will or pursuant to the laws of descent and distribution). Upon surrender of
2
<PAGE>
this Warrant to the Company at its principal office or at the office of its
stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other warrants which
carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as used herein
includes any Warrants into which this Warrant may be divided or exchanged. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and deliver
a new Warrant of like tenor and date. Any such new Warrant executed and
delivered shall constitute an additional contractual obligation on the part of
the Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at law
or equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the happening
of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall
be the number of shares of Common Stock outstanding after
giving effect to such action, and the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise
of each Warrant is adjusted pursuant to Subsection (1) above,
the number of Shares purchasable upon exercise of this Warrant
shall simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
3
<PAGE>
(3) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least five cents ($0.05) in such price;
provided, however, that any adjustments which by reason of
this Subsection (3) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend or
distribution in shares of Common Stock, or any subdivision,
reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities
convertible into Common Stock (including Warrants).
(4) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly but no later than
10 days after any request for such an adjustment by the
Holder, cause a notice setting forth the adjusted Exercise
Price and adjusted number of Shares issuable upon exercise of
each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to
the Holders at their last addresses appearing in the Warrant
Register, and shall cause a certified copy thereof to be
mailed to its transfer agent, if any. The Company may retain a
firm of independent certified public accountants selected by
the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by
this Section (f), and a certificate signed by such firm shall
be conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an
adjustment made pursuant to Subsection (1) above, the Holder
of this Warrant thereafter shall become entitled to receive
any shares of the Company, other than Common Stock, thereafter
the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Common Stock contained
in Subsections (1) to (3), inclusive above.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
4
<PAGE>
including a statementof the number of additional shares of Common Stock, if any,
and such other facts as shall be necessary to show the reason for and the manner
of computing such adjustment. Each such officer's certificate shall be made
available at all reasonable times for inspection by the holder or any holder of
a Warrant executed and delivered pursuant to Section (a) and the Company shall,
forthwith after each such adjustment, mail a copy by certified mail of such
certificate to the Holder or any such holder.
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------------
Gerardo Canet, President & CEO
Dated: ____________, 1998
Attest:
/s/Claude E. White
- -----------------------------
Claude E. White, Secretary
[Seal]
5
<PAGE>
PURCHASE FORM
Date: ________________________
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing _______ shares of Common Stock and
hereby makes payment of _______ in payment of the actual exercise price thereof.
----------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name ________________________________
(Please typewrite or print in block letters)
Address ______________________________
Signature _____________________________
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and transfers unto
Name _____________________________
(Please typewrite or print in block letters)
Address ____________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date:_____________________________
Signature _________________________
<PAGE>
************************************************************************
STOCK PURCHASE WARRANT
To Purchase Common Stock of
INTEGRAMED AMERICA, INC.
************************************************************************
VOID AFTER 5:00 P.M. NEW YORK TIME, ON ARIL 6, 2003
WARRANT TO PURCHASE 15,000 SHARES OF COMMON STOCK
WARRANT TO PURCHASE COMMON STOCK
OF
INTEGRAMED AMERICA, INC.
This is to Certify That, FOR VALUE RECEIVED, DONALD GALEN, or
assigns ("Holder"), is entitled to purchase, subject to the provisions of this
Warrant, from IntegraMed America, Inc., a Delaware corporation ("Company"),
15,000 fully paid, validly issued and nonassessable shares of Common Stock, par
value $.01 per share, of the Company ("Common Stock") at a price of $1.75 per
share at any time or from time to time during the period from April 6, 1998 to
April 5, 2003, but not later than 5:00 p.m. New York City Time, on April 5,
2003. The number of shares of Common Stock to be received upon the exercise of
this Warrant and the price to be paid for each share of Common Stock may be
adjusted from time to time as hereinafter set forth. The shares of Common Stock
deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as "Warrant Shares" and the exercise price of
a share of Common Stock in effect at any time and as adjusted from time to time
is hereinafter sometimes referred to as the "Exercise Price".
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part
at any time or from time to time on or after April 6, 1998 and until April 5,
2003 (the "Exercise Period"), subject to the provisions of Section (j)(2)
hereof; provided, however, that if such day is a day on which banking
institutions in the State of New York are authorized by law to close, then on
the next succeeding day which shall not be such a day. This Warrant may be
exercised by presentation and surrender hereof to the Company at its principal
office, or at the office of its stock transfer agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form. As soon as
practicable after each such exercise of the warrants, but not later than seven
(7) days from the date of such exercise, the Company shall issue and deliver to
the Holder a certificate or certificate for the Warrant Shares issuable upon
such exercise, registered in the name of the Holder or its designee. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
1
<PAGE>
rights of the Holder thereof to purchase the balance of the Warrant Shares
purchasable thereunder. Upon receipt by the Company of this Warrant at its
office, or by the stock transfer agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a national
securities exchange or admitted to unlisted trading privileges
on such exchange or listed for trading on the Nasdaq National
Market, the current market value shall be the last reported
sale price of the Common Stock on such exchange or market on
the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average
closing bid and asked prices for such day on such exchange or
market; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, but is traded on the Nasdaq
Small Cap Market, the current Market Value shall be the
average of the closing bid and asked prices for such day on
such market and if the Common Stock is not so traded, the
current market value shall be the mean of the last reported
bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to the date of the
exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. This Warrant is not transferable (other than
by will or pursuant to the laws of descent and distribution). Upon surrender of
2
<PAGE>
this Warrant to the Company at its principal office or at the office of its
stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other warrants which
carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as used herein
includes any Warrants into which this Warrant may be divided or exchanged. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and deliver
a new Warrant of like tenor and date. Any such new Warrant executed and
delivered shall constitute an additional contractual obligation on the part of
the Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at law
or equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the happening
of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall
be the number of shares of Common Stock outstanding after
giving effect to such action, and the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise
of each Warrant is adjusted pursuant to Subsection (1) above,
the number of Shares purchasable upon exercise of this Warrant
shall simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
3
<PAGE>
(3) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least five cents ($0.05) in such price;
provided, however, that any adjustments which by reason of
this Subsection (3) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend or
distribution in shares of Common Stock, or any subdivision,
reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities
convertible into Common Stock (including Warrants).
(4) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly but no later than
10 days after any request for such an adjustment by the
Holder, cause a notice setting forth the adjusted Exercise
Price and adjusted number of Shares issuable upon exercise of
each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to
the Holders at their last addresses appearing in the Warrant
Register, and shall cause a certified copy thereof to be
mailed to its transfer agent, if any. The Company may retain a
firm of independent certified public accountants selected by
the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by
this Section (f), and a certificate signed by such firm shall
be conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an
adjustment made pursuant to Subsection (1) above, the Holder
of this Warrant thereafter shall become entitled to receive
any shares of the Company, other than Common Stock, thereafter
the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Common Stock contained
in Subsections (1) to (3), inclusive above.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
including a statement of the number of additional shares of Common Stock, if
any, and such other facts as shall be necessary to show the reason for and the
manner of computing such adjustment. Each such officer's certificate shall be
made available at all reasonable times for inspection by the holder or any
holder of a Warrant executed and delivered pursuant to Section (a) and the
Company shall, forthwith after each such adjustment, mail a copy by certified
mail of such certificate to the Holder or any such holder.
4
<PAGE>
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------------
Gerardo Canet, President & CEO
Dated: April 6, 1998
Attest:
/s/Claude E. White
- -----------------------------
Claude E. White, Secretary
[Seal]
5
<PAGE>
PURCHASE FORM
-------------
Date: ________________________
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing _______ shares of Common Stock and
hereby makes payment of _______ in payment of the actual exercise price thereof.
----------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
--------------------------------------
Name ________________________________
(Please typewrite or print in block letters)
Address ______________________________
Signature _____________________________
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and
transfers unto
Name _____________________________
(Please typewrite or print in block letters)
Address ____________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date:_____________________________
Signature _________________________
************************************************************************
STOCK PURCHASE WARRANT
To Purchase Common Stock of
INTEGRAMED AMERICA, INC.
************************************************************************
VOID AFTER 5:00 P.M. NEW YORK TIME, ON ARIL 6, 2003
WARRANT TO PURCHASE 15,000 SHARES OF COMMON STOCK
WARRANT TO PURCHASE COMMON STOCK
OF
INTEGRAMED AMERICA, INC.
This is to Certify That, FOR VALUE RECEIVED, ARNOLD JACOBSON,
or assigns ("Holder"), is entitled to purchase, subject to the provisions of
this Warrant, from IntegraMed America, Inc., a Delaware corporation ("Company"),
15,000 fully paid, validly issued and nonassessable shares of Common Stock, par
value $.01 per share, of the Company ("Common Stock") at a price of $1.75 per
share at any time or from time to time during the period from April 6, 1998 to
April 5, 2003, but not later than 5:00 p.m. New York City Time, on April 5,
2003. The number of shares of Common Stock to be received upon the exercise of
this Warrant and the price to be paid for each share of Common Stock may be
adjusted from time to time as hereinafter set forth. The shares of Common Stock
deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as "Warrant Shares" and the exercise price of
a share of Common Stock in effect at any time and as adjusted from time to time
is hereinafter sometimes referred to as the "Exercise Price".
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part
at any time or from time to time on or after April 6, 1998 and until April 5,
2003 (the "Exercise Period"), subject to the provisions of Section (j)(2)
hereof; provided, however, that if such day is a day on which banking
institutions in the State of New York are authorized by law to close, then on
the next succeeding day which shall not be such a day. This Warrant may be
exercised by presentation and surrender hereof to the Company at its principal
office, or at the office of its stock transfer agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form. As soon as
practicable after each such exercise of the warrants, but not later than seven
(7) days from the date of such exercise, the Company shall issue and deliver to
the Holder a certificate or certificate for the Warrant Shares issuable upon
such exercise, registered in the name of the Holder or its designee. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
1
<PAGE>
rights of the Holder thereof to purchase the balance of the Warrant Shares
purchasable thereunder. Upon receipt by the Company of this Warrant at its
office, or by the stock transfer agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a national
securities exchange or admitted to unlisted trading privileges
on such exchange or listed for trading on the Nasdaq National
Market, the current market value shall be the last reported
sale price of the Common Stock on such exchange or market on
the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average
closing bid and asked prices for such day on such exchange or
market; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, but is traded on the Nasdaq
Small Cap Market, the current Market Value shall be the
average of the closing bid and asked prices for such day on
such market and if the Common Stock is not so traded, the
current market value shall be the mean of the last reported
bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to the date of the
exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. This Warrant is not transferable (other than
by will or pursuant to the laws of descent and distribution). Upon surrender of
2
<PAGE>
this Warrant to the Company at its principal office or at the office of its
stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other warrants which
carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as used herein
includes any Warrants into which this Warrant may be divided or exchanged. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and deliver
a new Warrant of like tenor and date. Any such new Warrant executed and
delivered shall constitute an additional contractual obligation on the part of
the Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at law
or equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the happening
of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall
be the number of shares of Common Stock outstanding after
giving effect to such action, and the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise
of each Warrant is adjusted pursuant to Subsection (1) above,
the number of Shares purchasable upon exercise of this Warrant
shall simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
3
<PAGE>
(3) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least five cents ($0.05) in such price;
provided, however, that any adjustments which by reason of
this Subsection (3) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend or
distribution in shares of Common Stock, or any subdivision,
reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities
convertible into Common Stock (including Warrants).
(4) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly but no later than
10 days after any request for such an adjustment by the
Holder, cause a notice setting forth the adjusted Exercise
Price and adjusted number of Shares issuable upon exercise of
each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to
the Holders at their last addresses appearing in the Warrant
Register, and shall cause a certified copy thereof to be
mailed to its transfer agent, if any. The Company may retain a
firm of independent certified public accountants selected by
the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by
this Section (f), and a certificate signed by such firm shall
be conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an
adjustment made pursuant to Subsection (1) above, the Holder
of this Warrant thereafter shall become entitled to receive
any shares of the Company, other than Common Stock, thereafter
the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Common Stock contained
in Subsections (1) to (3), inclusive above.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
including a statement of the number of additional shares of Common Stock, if
any, and such other facts as shall be necessary to show the reason for and the
manner of computing such adjustment. Each such officer's certificate shall be
made available at all reasonable times for inspection by the holder or any
holder of a Warrant executed and delivered pursuant to Section (a) and the
Company shall, forthwith after each such adjustment, mail a copy by certified
mail of such certificate to the Holder or any such holder.
4
<PAGE>
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------------
Gerardo Canet, President & CEO
Dated: April 6, 1998
Attest:
/s/Claude E. White
- -----------------------------
Claude E. White, Secretary
[Seal]
5
<PAGE>
PURCHASE FORM
-------------
Date: ________________________
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing _______ shares of Common Stock and
hereby makes payment of _______ in payment of the actual exercise price thereof.
----------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
--------------------------------------
Name ________________________________
(Please typewrite or print in block letters)
Address ______________________________
Signature _____________________________
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and
transfers unto
Name _____________________________
(Please typewrite or print in block letters)
Address ____________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date:_____________________________
Signature _________________________
************************************************************************
STOCK PURCHASE WARRANT
To Purchase Common Stock of
INTEGRAMED AMERICA, INC.
************************************************************************
VOID AFTER 5:00 P.M. NEW YORK TIME, ON ARIL 6, 2003
WARRANT TO PURCHASE 15,000 SHARES OF COMMON STOCK
WARRANT TO PURCHASE COMMON STOCK
OF
INTEGRAMED AMERICA, INC.
This is to Certify That, FOR VALUE RECEIVED, LOUIS WECKSTEIN,
or assigns ("Holder"), is entitled to purchase, subject to the provisions of
this Warrant, from IntegraMed America, Inc., a Delaware corporation ("Company"),
15,000 fully paid, validly issued and nonassessable shares of Common Stock, par
value $.01 per share, of the Company ("Common Stock") at a price of $1.75 per
share at any time or from time to time during the period from April 6, 1998 to
April 5, 2003, but not later than 5:00 p.m. New York City Time, on April 5,
2003. The number of shares of Common Stock to be received upon the exercise of
this Warrant and the price to be paid for each share of Common Stock may be
adjusted from time to time as hereinafter set forth. The shares of Common Stock
deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as "Warrant Shares" and the exercise price of
a share of Common Stock in effect at any time and as adjusted from time to time
is hereinafter sometimes referred to as the "Exercise Price".
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part
at any time or from time to time on or after April 6, 1998 and until April 5,
2003 (the "Exercise Period"), subject to the provisions of Section (j)(2)
hereof; provided, however, that if such day is a day on which banking
institutions in the State of New York are authorized by law to close, then on
the next succeeding day which shall not be such a day. This Warrant may be
exercised by presentation and surrender hereof to the Company at its principal
office, or at the office of its stock transfer agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form. As soon as
practicable after each such exercise of the warrants, but not later than seven
(7) days from the date of such exercise, the Company shall issue and deliver to
the Holder a certificate or certificate for the Warrant Shares issuable upon
such exercise, registered in the name of the Holder or its designee. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
1
<PAGE>
rights of the Holder thereof to purchase the balance of the Warrant Shares
purchasable thereunder. Upon receipt by the Company of this Warrant at its
office, or by the stock transfer agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a national
securities exchange or admitted to unlisted trading privileges
on such exchange or listed for trading on the Nasdaq National
Market, the current market value shall be the last reported
sale price of the Common Stock on such exchange or market on
the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average
closing bid and asked prices for such day on such exchange or
market; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, but is traded on the Nasdaq
Small Cap Market, the current Market Value shall be the
average of the closing bid and asked prices for such day on
such market and if the Common Stock is not so traded, the
current market value shall be the mean of the last reported
bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to the date of the
exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. This Warrant is not transferable (other than
by will or pursuant to the laws of descent and distribution). Upon surrender of
2
<PAGE>
this Warrant to the Company at its principal office or at the office of its
stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other warrants which
carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as used herein
includes any Warrants into which this Warrant may be divided or exchanged. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and deliver
a new Warrant of like tenor and date. Any such new Warrant executed and
delivered shall constitute an additional contractual obligation on the part of
the Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at law
or equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the happening
of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall
be the number of shares of Common Stock outstanding after
giving effect to such action, and the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise
of each Warrant is adjusted pursuant to Subsection (1) above,
the number of Shares purchasable upon exercise of this Warrant
shall simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
3
<PAGE>
(3) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least five cents ($0.05) in such price;
provided, however, that any adjustments which by reason of
this Subsection (3) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend or
distribution in shares of Common Stock, or any subdivision,
reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities
convertible into Common Stock (including Warrants).
(4) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly but no later than
10 days after any request for such an adjustment by the
Holder, cause a notice setting forth the adjusted Exercise
Price and adjusted number of Shares issuable upon exercise of
each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to
the Holders at their last addresses appearing in the Warrant
Register, and shall cause a certified copy thereof to be
mailed to its transfer agent, if any. The Company may retain a
firm of independent certified public accountants selected by
the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by
this Section (f), and a certificate signed by such firm shall
be conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an
adjustment made pursuant to Subsection (1) above, the Holder
of this Warrant thereafter shall become entitled to receive
any shares of the Company, other than Common Stock, thereafter
the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Common Stock contained
in Subsections (1) to (3), inclusive above.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
including a statement of the number of additional shares of Common Stock, if
any, and such other facts as shall be necessary to show the reason for and the
manner of computing such adjustment. Each such officer's certificate shall be
made available at all reasonable times for inspection by the holder or any
holder of a Warrant executed and delivered pursuant to Section (a) and the
Company shall, forthwith after each such adjustment, mail a copy by certified
mail of such certificate to the Holder or any such holder.
4
<PAGE>
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------------
Gerardo Canet, President & CEO
Dated: April 6, 1998
Attest:
/s/Claude E. White
- -----------------------------
Claude E. White, Secretary
[Seal]
5
<PAGE>
PURCHASE FORM
-------------
Date: ________________________
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing _______ shares of Common Stock and
hereby makes payment of _______ in payment of the actual exercise price thereof.
----------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
--------------------------------------
Name ________________________________
(Please typewrite or print in block letters)
Address ______________________________
Signature _____________________________
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and
transfers unto
Name _____________________________
(Please typewrite or print in block letters)
Address ____________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date:_____________________________
Signature _________________________
************************************************************************
STOCK PURCHASE WARRANT
To Purchase Common Stock of
INTEGRAMED AMERICA, INC.
************************************************************************
VOID AFTER 5:00 P.M. NEW YORK TIME, ON ARIL 15, 2003
WARRANT TO PURCHASE 15,000 SHARES OF COMMON STOCK
WARRANT TO PURCHASE COMMON STOCK
OF
INTEGRAMED AMERICA, INC.
This is to Certify That, FOR VALUE RECEIVED,MICHAEL J. LEVY,
or assigns ("Holder"), is entitled to purchase, subject to the provisions of
this Warrant, from IntegraMed America, Inc., a Delaware corporation ("Company"),
15,000 fully paid, validly issued and nonassessable shares of Common Stock, par
value $.01 per share, of the Company ("Common Stock") at a price of $1.75 per
share at any time or from time to time during the period from April 16, 1998 to
April 15, 2003, but not later than 5:00 p.m. New York City Time, on April 15,
2003. The number of shares of Common Stock to be received upon the exercise of
this Warrant and the price to be paid for each share of Common Stock may be
adjusted from time to time as hereinafter set forth. The shares of Common Stock
deliverable upon such exercise, and as adjusted from time to time, are
hereinafter sometimes referred to as "Warrant Shares" and the exercise price of
a share of Common Stock in effect at any time and as adjusted from time to time
is hereinafter sometimes referred to as the "Exercise Price".
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part
at any time or from time to time on or after April 16, 1998 and until April 15,
2003 (the "Exercise Period"), subject to the provisions of Section (j)(2)
hereof; provided, however, that if such day is a day on which banking
institutions in the State of New York are authorized by law to close, then on
the next succeeding day which shall not be such a day. This Warrant may be
exercised by presentation and surrender hereof to the Company at its principal
office, or at the office of its stock transfer agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form. As soon as
practicable after each such exercise of the warrants, but not later than seven
(7) days from the date of such exercise, the Company shall issue and deliver to
the Holder a certificate or certificate for the Warrant Shares issuable upon
such exercise, registered in the name of the Holder or its designee. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
1
<PAGE>
rights of the Holder thereof to purchase the balance of the Warrant Shares
purchasable thereunder. Upon receipt by the Company of this Warrant at its
office, or by the stock transfer agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a national
securities exchange or admitted to unlisted trading privileges
on such exchange or listed for trading on the Nasdaq National
Market, the current market value shall be the last reported
sale price of the Common Stock on such exchange or market on
the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average
closing bid and asked prices for such day on such exchange or
market; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, but is traded on the Nasdaq
Small Cap Market, the current Market Value shall be the
average of the closing bid and asked prices for such day on
such market and if the Common Stock is not so traded, the
current market value shall be the mean of the last reported
bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to the date of the
exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. This Warrant is not transferable (other than
by will or pursuant to the laws of descent and distribution). Upon surrender of
2
<PAGE>
this Warrant to the Company at its principal office or at the office of its
stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other warrants which
carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as used herein
includes any Warrants into which this Warrant may be divided or exchanged. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and deliver
a new Warrant of like tenor and date. Any such new Warrant executed and
delivered shall constitute an additional contractual obligation on the part of
the Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at law
or equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the happening
of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall
be the number of shares of Common Stock outstanding after
giving effect to such action, and the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise
of each Warrant is adjusted pursuant to Subsection (1) above,
the number of Shares purchasable upon exercise of this Warrant
shall simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
3
<PAGE>
(3) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least five cents ($0.05) in such price;
provided, however, that any adjustments which by reason of
this Subsection (3) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend or
distribution in shares of Common Stock, or any subdivision,
reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities
convertible into Common Stock (including Warrants).
(4) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly but no later than
10 days after any request for such an adjustment by the
Holder, cause a notice setting forth the adjusted Exercise
Price and adjusted number of Shares issuable upon exercise of
each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to
the Holders at their last addresses appearing in the Warrant
Register, and shall cause a certified copy thereof to be
mailed to its transfer agent, if any. The Company may retain a
firm of independent certified public accountants selected by
the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by
this Section (f), and a certificate signed by such firm shall
be conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an
adjustment made pursuant to Subsection (1) above, the Holder
of this Warrant thereafter shall become entitled to receive
any shares of the Company, other than Common Stock, thereafter
the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Common Stock contained
in Subsections (1) to (3), inclusive above.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
4
<PAGE>
including a statement of the number of additional shares of Common Stock, if
any, and such other facts as shall be necessary to show the reason for and the
manner of computing such adjustment. Each such officer's certificate shall be
made available at all reasonable times for inspection by the holder or any
holder of a Warrant executed and delivered pursuant to Section (a) and the
Company shall, forthwith after each such adjustment, mail a copy by certified
mail of such certificate to the Holder or any such holder.
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------------
Gerardo Canet, President & CEO
Dated: April 16, 1998
Attest:
/s/Claude E. White
- -----------------------------
Claude E. White, Secretary
[Seal]
5
<PAGE>
PURCHASE FORM
Date: ________________________
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing _______ shares of Common Stock and
hereby makes payment of _______ in payment of the actual exercise price thereof.
----------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name ________________________________
(Please typewrite or print in block letters)
Address ______________________________
Signature _____________________________
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and transfers unto
Name _____________________________
(Please typewrite or print in block letters)
Address ____________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date:_____________________________
Signature _________________________
<PAGE>
************************************************************************
STOCK PURCHASE WARRANT
To Purchase Common Stock of
INTEGRAMED AMERICA, INC.
************************************************************************
VOID AFTER 5:00 P.M. NEW YORK TIME, ON ARIL 15, 2003
WARRANT TO PURCHASE 15,000 SHARES OF COMMON STOCK
WARRANT TO PURCHASE COMMON STOCK
OF
INTEGRAMED AMERICA, INC.
This is to Certify That, FOR VALUE RECEIVED,ARTHUR W.
SAGOSKIN, or assigns ("Holder"), is entitled to purchase, subject to the
provisions of this Warrant, from IntegraMed America, Inc., a Delaware
corporation ("Company"), 15,000 fully paid, validly issued and nonassessable
shares of Common Stock, par value $.01 per share, of the Company ("Common
Stock") at a price of $1.75 per share at any time or from time to time during
the period from April 16, 1998 to April 15, 2003, but not later than 5:00 p.m.
New York City Time, on April 15, 2003. The number of shares of Common Stock to
be received upon the exercise of this Warrant and the price to be paid for each
share of Common Stock may be adjusted from time to time as hereinafter set
forth. The shares of Common Stock deliverable upon such exercise, and as
adjusted from time to time, are hereinafter sometimes referred to as "Warrant
Shares" and the exercise price of a share of Common Stock in effect at any time
and as adjusted from time to time is hereinafter sometimes referred to as the
"Exercise Price".
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part
at any time or from time to time on or after April 16, 1998 and until April 15,
2003 (the "Exercise Period"), subject to the provisions of Section (j)(2)
hereof; provided, however, that if such day is a day on which banking
institutions in the State of New York are authorized by law to close, then on
the next succeeding day which shall not be such a day. This Warrant may be
exercised by presentation and surrender hereof to the Company at its principal
office, or at the office of its stock transfer agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form. As soon as
practicable after each such exercise of the warrants, but not later than seven
(7) days from the date of such exercise, the Company shall issue and deliver to
the Holder a certificate or certificate for the Warrant Shares issuable upon
such exercise, registered in the name of the Holder or its designee. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
1
<PAGE>
rights of the Holder thereof to purchase the balance of the Warrant Shares
purchasable thereunder. Upon receipt by the Company of this Warrant at its
office, or by the stock transfer agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a national
securities exchange or admitted to unlisted trading privileges
on such exchange or listed for trading on the Nasdaq National
Market, the current market value shall be the last reported
sale price of the Common Stock on such exchange or market on
the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average
closing bid and asked prices for such day on such exchange or
market; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, but is traded on the Nasdaq
Small Cap Market, the current Market Value shall be the
average of the closing bid and asked prices for such day on
such market and if the Common Stock is not so traded, the
current market value shall be the mean of the last reported
bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to the date of the
exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. This Warrant is not transferable (other than
by will or pursuant to the laws of descent and distribution). Upon surrender of
2
<PAGE>
this Warrant to the Company at its principal office or at the office of its
stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other warrants which
carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as used herein
includes any Warrants into which this Warrant may be divided or exchanged. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and deliver
a new Warrant of like tenor and date. Any such new Warrant executed and
delivered shall constitute an additional contractual obligation on the part of
the Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at law
or equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the happening
of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall
be the number of shares of Common Stock outstanding after
giving effect to such action, and the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise
of each Warrant is adjusted pursuant to Subsection (1) above,
the number of Shares purchasable upon exercise of this Warrant
shall simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
3
<PAGE>
(3) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least five cents ($0.05) in such price;
provided, however, that any adjustments which by reason of
this Subsection (3) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend or
distribution in shares of Common Stock, or any subdivision,
reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities
convertible into Common Stock (including Warrants).
(4) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly but no later than
10 days after any request for such an adjustment by the
Holder, cause a notice setting forth the adjusted Exercise
Price and adjusted number of Shares issuable upon exercise of
each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to
the Holders at their last addresses appearing in the Warrant
Register, and shall cause a certified copy thereof to be
mailed to its transfer agent, if any. The Company may retain a
firm of independent certified public accountants selected by
the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by
this Section (f), and a certificate signed by such firm shall
be conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an
adjustment made pursuant to Subsection (1) above, the Holder
of this Warrant thereafter shall become entitled to receive
any shares of the Company, other than Common Stock, thereafter
the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Common Stock contained
in Subsections (1) to (3), inclusive above.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
4
<PAGE>
including a statement of the number of additional shares of Common Stock, if
any, and such other facts as shall be necessary to show the reason for and the
manner of computing such adjustment. Each such officer's certificate shall be
made available at all reasonable times for inspection by the holder or any
holder of a Warrant executed and delivered pursuant to Section (a) and the
Company shall, forthwith after each such adjustment, mail a copy by certified
mail of such certificate to the Holder or any such holder.
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------------
Gerardo Canet, President & CEO
Dated: April 16, 1998
Attest:
/s/Claude E. White
- -----------------------------
Claude E. White, Secretary
[Seal]
5
<PAGE>
PURCHASE FORM
Date: ________________________
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing _______ shares of Common Stock and
hereby makes payment of _______ in payment of the actual exercise price thereof.
----------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name ________________________________
(Please typewrite or print in block letters)
Address ______________________________
Signature _____________________________
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and transfers unto
Name _____________________________
(Please typewrite or print in block letters)
Address ____________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date:_____________________________
Signature _________________________
<PAGE>
************************************************************************
STOCK PURCHASE WARRANT
To Purchase Common Stock of
INTEGRAMED AMERICA, INC.
************************************************************************
VOID AFTER 5:00 P.M. NEW YORK TIME, ON ARIL 15, 2003
WARRANT TO PURCHASE 15,000 SHARES OF COMMON STOCK
WARRANT TO PURCHASE COMMON STOCK
OF
INTEGRAMED AMERICA, INC.
This is to Certify That, FOR VALUE RECEIVED, ROBERT J.
STILLMAN, or assigns ("Holder"), is entitled to purchase, subject to the
provisions of this Warrant, from IntegraMed America, Inc., a Delaware
corporation ("Company"), 15,000 fully paid, validly issued and nonassessable
shares of Common Stock, par value $.01 per share, of the Company ("Common
Stock") at a price of $1.75 per share at any time or from time to time during
the period from April 16, 1998 to April 15, 2003, but not later than 5:00 p.m.
New York City Time, on April 15, 2003. The number of shares of Common Stock to
be received upon the exercise of this Warrant and the price to be paid for each
share of Common Stock may be adjusted from time to time as hereinafter set
forth. The shares of Common Stock deliverable upon such exercise, and as
adjusted from time to time, are hereinafter sometimes referred to as "Warrant
Shares" and the exercise price of a share of Common Stock in effect at any time
and as adjusted from time to time is hereinafter sometimes referred to as the
"Exercise Price".
(a) EXERCISE OF WARRANT.
(1) This Warrant may be exercised in whole or in part
at any time or from time to time on or after April 16, 1998 and until April 15,
2003 (the "Exercise Period"), subject to the provisions of Section (j)(2)
hereof; provided, however, that if such day is a day on which banking
institutions in the State of New York are authorized by law to close, then on
the next succeeding day which shall not be such a day. This Warrant may be
exercised by presentation and surrender hereof to the Company at its principal
office, or at the office of its stock transfer agent, if any, with the Purchase
Form annexed hereto duly executed and accompanied by payment of the Exercise
Price for the number of Warrant Shares specified in such form. As soon as
practicable after each such exercise of the warrants, but not later than seven
(7) days from the date of such exercise, the Company shall issue and deliver to
the Holder a certificate or certificate for the Warrant Shares issuable upon
such exercise, registered in the name of the Holder or its designee. If this
Warrant should be exercised in part only, the Company shall, upon surrender of
this Warrant for cancellation, execute and deliver a new Warrant evidencing the
1
<PAGE>
rights of the Holder thereof to purchase the balance of the Warrant Shares
purchasable thereunder. Upon receipt by the Company of this Warrant at its
office, or by the stock transfer agent of the Company at its office, in proper
form for exercise, the Holder shall be deemed to be the holder of record of the
shares of Common Stock issuable upon such exercise, notwithstanding that the
stock transfer books of the Company shall then be closed or that certificates
representing such shares of Common Stock shall not then be physically delivered
to the Holder.
(b) RESERVATION OF SHARES. The Company shall at all times
reserve for issuance and/or delivery upon exercise of this Warrant such number
of shares of its Common Stock as shall be required for issuance and delivery
upon exercise of the Warrants.
(c) FRACTIONAL SHARES. No fractional shares or script
representing fractional shares shall be issued upon the exercise of this
Warrant. With respect to any fraction of a share called for upon any exercise
hereof, the Company shall pay to the Holder an amount in cash equal to such
fraction multiplied by the current market value of a share, determined as
follows:
(1) If the Common Stock is listed on a national
securities exchange or admitted to unlisted trading privileges
on such exchange or listed for trading on the Nasdaq National
Market, the current market value shall be the last reported
sale price of the Common Stock on such exchange or market on
the last business day prior to the date of exercise of this
Warrant or if no such sale is made on such day, the average
closing bid and asked prices for such day on such exchange or
market; or
(2) If the Common Stock is not so listed or admitted
to unlisted trading privileges, but is traded on the Nasdaq
Small Cap Market, the current Market Value shall be the
average of the closing bid and asked prices for such day on
such market and if the Common Stock is not so traded, the
current market value shall be the mean of the last reported
bid and asked prices reported by the National Quotation
Bureau, Inc. on the last business day prior to the date of the
exercise of this Warrant; or
(3) If the Common Stock is not so listed or admitted
to unlisted trading privileges and bid and asked prices are
not so reported, the current market value shall be an amount,
not less than book value thereof as at the end of the most
recent fiscal year of the Company ending prior to the date of
the exercise of the Warrant, determined in such reasonable
manner as may be prescribed by the Board of Directors of the
Company.
(d) EXCHANGE, TRANSFER, ASSIGNMENT OR LOSS OF WARRANT. This
Warrant is exchangeable, without expense, at the option of the Holder, upon
presentation and surrender hereof to the Company or at the office of its stock
transfer agent, if any, for other warrants of different denominations entitling
the holder thereof to purchase in the aggregate the same number of shares of
Common Stock purchasable hereunder. This Warrant is not transferable (other than
by will or pursuant to the laws of descent and distribution). Upon surrender of
2
<PAGE>
this Warrant to the Company at its principal office or at the office of its
stock transfer agent, if any, with the Assignment Form annexed hereto duly
executed and funds sufficient to pay any transfer tax, the Company shall,
without charge, execute and deliver a new Warrant in the name of the assignee
named in such instrument of assignment and this Warrant shall promptly be
canceled. This Warrant may be divided or combined with other warrants which
carry the same rights upon presentation hereof at the principal office of the
Company or at the office of its stock transfer agent, if any, together with a
written notice specifying the names and denominations in which new Warrants are
to be issued and signed by the Holder hereof. The term "Warrant" as used herein
includes any Warrants into which this Warrant may be divided or exchanged. Upon
receipt by the Company of evidence satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and (in the case of loss, theft or
destruction) of reasonably satisfactory indemnification, and upon surrender and
cancellation of this Warrant, if mutilated, the Company will execute and deliver
a new Warrant of like tenor and date. Any such new Warrant executed and
delivered shall constitute an additional contractual obligation on the part of
the Company, whether or not this Warrant so lost, stolen, destroyed, or
mutilated shall be at any time enforceable by anyone.
(e) RIGHTS OF THE HOLDER. The Holder shall not, by virtue
hereof, be entitled to any rights of a shareholder in the Company, either at law
or equity, and the rights of the Holder are limited to those expressed in the
Warrant and are not enforceable against the Company except to the extent set
forth herein.
(f) ANTI-DILUTION PROVISIONS. The Exercise Price in effect at
any time and the number and kind of securities purchasable upon the exercise of
the Warrants shall be subject to adjustment from time to time upon the happening
of certain events as follows:
(1) In case the Company shall (i) declare a dividend
or make a distribution on its outstanding shares of Common
Stock in shares of Common Stock, (ii) subdivide or reclassify
its outstanding shares of Common Stock into a greater number
of shares, or (iii) combine or reclassify its outstanding
shares of Common Stock into a smaller number of shares, the
Exercise Price in effect at the time of the record date for
such dividend or distribution or of the effective date of such
subdivision, combination or reclassification shall be adjusted
so that it shall equal the price determined by multiplying the
Exercise Price by a fraction, the denominator of which shall
be the number of shares of Common Stock outstanding after
giving effect to such action, and the numerator of which shall
be the number of shares of Common Stock outstanding
immediately prior to such action. Such adjustment shall be
made successively whenever any event listed above shall occur.
(2) Whenever the Exercise Price payable upon exercise
of each Warrant is adjusted pursuant to Subsection (1) above,
the number of Shares purchasable upon exercise of this Warrant
shall simultaneously be adjusted by multiplying the number of
Shares initially issuable upon exercise of this Warrant by the
Exercise Price in effect on the date hereof and dividing the
product so obtained by the Exercise Price, as adjusted.
3
<PAGE>
(3) No adjustment in the Exercise Price shall be
required unless such adjustment would require an increase or
decrease of at least five cents ($0.05) in such price;
provided, however, that any adjustments which by reason of
this Subsection (3) are not required to be made shall be
carried forward and taken into account in any subsequent
adjustment required to be made hereunder. All calculations
under this Section (f) shall be made to the nearest cent or to
the nearest one-hundredth of a share, as the case may be.
Anything in this Section (f) to the contrary notwithstanding,
the Company shall be entitled, but shall not be required, to
make such changes in the Exercise Price, in addition to those
required by this Section (f), as it shall determine, in its
sole discretion, to be advisable in order that any dividend or
distribution in shares of Common Stock, or any subdivision,
reclassification or combination of Common Stock, hereafter
made by the Company shall not result in any Federal Income tax
liability to the holders of Common Stock or securities
convertible into Common Stock (including Warrants).
(4) Whenever the Exercise Price is adjusted, as
herein provided, the Company shall promptly but no later than
10 days after any request for such an adjustment by the
Holder, cause a notice setting forth the adjusted Exercise
Price and adjusted number of Shares issuable upon exercise of
each Warrant, and, if requested, information describing the
transactions giving rise to such adjustments, to be mailed to
the Holders at their last addresses appearing in the Warrant
Register, and shall cause a certified copy thereof to be
mailed to its transfer agent, if any. The Company may retain a
firm of independent certified public accountants selected by
the Board of Directors (who may be the regular accountants
employed by the Company) to make any computation required by
this Section (f), and a certificate signed by such firm shall
be conclusive evidence of the correctness of such adjustment.
(5) In the event that at any time, as a result of an
adjustment made pursuant to Subsection (1) above, the Holder
of this Warrant thereafter shall become entitled to receive
any shares of the Company, other than Common Stock, thereafter
the number of such other shares so receivable upon exercise of
this Warrant shall be subject to adjustment from time to time
in a manner and on terms as nearly equivalent as practicable
to the provisions with respect to the Common Stock contained
in Subsections (1) to (3), inclusive above.
(g) OFFICER'S CERTIFICATE. Whenever the Exercise Price shall
be adjusted as required by the provisions of the foregoing Section, the Company
shall forthwith file in the custody of its Secretary or an Assistant Secretary
at its principal office and with its stock transfer agent, if any, an officer's
certificate showing the adjusted Exercise Price determined as herein provided,
setting forth in reasonable detail the facts requiring such adjustment,
4
<PAGE>
including a statement of the number of additional shares of Common Stock, if
any, and such other facts as shall be necessary to show the reason for and the
manner of computing such adjustment. Each such officer's certificate shall be
made available at all reasonable times for inspection by the holder or any
holder of a Warrant executed and delivered pursuant to Section (a) and the
Company shall, forthwith after each such adjustment, mail a copy by certified
mail of such certificate to the Holder or any such holder.
(h) NOTICES TO WARRANT HOLDERS. So long as this Warrant shall
be outstanding, (i) if the Company shall pay any dividend or make any
distribution upon the Common Stock or (ii) if the Company shall offer to the
holders of Common Stock for subscription or purchase by them any share of any
class or any other rights or (iii) if any capital reorganization of the Company,
reclassification of the capital stock of the Company, consolidation or merger of
the Company with or into another corporation, sale, lease or transfer of all or
substantially all of the property and assets of the Company to another
corporation, or voluntary or involuntary dissolution, liquidation or winding up
of the Company shall be effected, then in any such case, the Company shall cause
to be mailed by certified mail to the Holder, at least fifteen days prior the
date specified in (x) or (y) below, as the case may be, a notice containing a
brief description of the proposed action and stating the date on which (x) a
record is to be taken for the purpose of such dividend, distribution or rights,
or (y) such reclassification, reorganization, consolidation, merger, conveyance,
lease, dissolution, liquidation or winding up is to take place and the date, if
any is to be fixed, as of which the holders of Common Stock or other securities
shall receive cash or other property deliverable upon such reclassification,
reorganization, consolidation, merger, conveyance, dissolution, liquidation or
winding up.
(i) RECLASSIFICATION, REORGANIZATION OR MERGER. In case of any
reclassification, capital reorganization or other change of outstanding shares
of Common Stock of the Company, or in case of any consolidation or merger of the
Company with or into another corporation (other than a merger with a subsidiary
in which merger the Company is the continuing corporation and which does not
result in any reclassification, capital reorganization or other change of
outstanding shares of Common Stock of the class issuable upon exercise of this
Warrant) or in case of any sale, lease or conveyance to another corporation of
the property of the Company as an entirety, the Company shall, as a condition
precedent to such transaction, cause effective provisions to be made so that the
Holder shall have the right thereafter by exercising this Warrant at any time
prior to the expiration of the Warrant, to purchase the kind and amount of
shares of stock and other securities and property receivable upon such
reclassification, capital reorganization and other change, consolidation,
merger, sale or conveyance by a holder of the number of shares of Common Stock
which might have been purchased upon exercise of this Warrant immediately prior
to such reclassification, change, consolidation, merger, sale or conveyance. Any
such provision shall include provision for adjustments which shall be as nearly
equivalent as may be practicable to the adjustments provided for in this
Warrant. The foregoing provisions of this Section (i) shall similarly apply to
successive reclassifications, capital reorganizations and changes of shares of
Common Stock and to successive consolidations, mergers, sales or conveyances. In
the event that in connection with any such capital reorganization or
reclassification, consolidation, merger, sale or conveyance, additional shares
of Common Stock shall be issued in exchange, conversion, substitution or
payment, in whole or in part, for a security of the Company other than Common
Stock, any such issue shall be treated as an issue of Common Stock covered by
the provisions of Subsection (1) of Section (f) hereof.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------------
Gerardo Canet, President & CEO
Dated: April 16, 1998
Attest:
- -----------------------------
Claude E. White, Secretary
[Seal]
5
<PAGE>
PURCHASE FORM
Date: ________________________
The undersigned hereby irrevocably elects to exercise the
within Warrant to the extent of purchasing _______ shares of Common Stock and
hereby makes payment of _______ in payment of the actual exercise price thereof.
----------------
INSTRUCTIONS FOR REGISTRATION OF STOCK
Name ________________________________
(Please typewrite or print in block letters)
Address ______________________________
Signature _____________________________
<PAGE>
ASSIGNMENT FORM
FOR VALUE RECEIVED, ______________ hereby sells, assigns and transfers unto
Name _____________________________
(Please typewrite or print in block letters)
Address ____________________________
the right to purchase Common Stock represented by this Warrant to the extent of
______ shares as to which such right is exercisable and does hereby irrevocably
constitute and appoint ___________ as attorney, to transfer the same on the
books of the Company with full power of substitution in the premises.
Date:_____________________________
Signature _________________________
<PAGE>
************************************************************************
STOCK PURCHASE WARRANT
To Purchase Common Stock of
INTEGRAMED AMERICA, INC.
************************************************************************
AMENDMENT NO. 1 TO MANAGEMENT AGREEMENT
BETWEEN
INTEGRAMED AMERICA, INC.
AND
BAY AREA FERTILITY AND GYNECOLOGY MEDICAL GROUP, INC.
THIS AMENDMENT NO. 1 TO MANAGEMENT AGREEMENT ( "Amendment No. 1") is
dated April 5, 1998 by and between IntegraMed America, Inc., a Delaware
corporation, with its principal place of business at One Manhattanville Road,
Purchase, New York 10577 ("INMD") and Bay Area Fertility and Gynecology Medical
Group Inc., a California professional medical corporation, with its principal
place of business at 3160 Crow Canyon Road, Suite 150, San Ramon, California
94583 ("Bay Area Fertility").
RECITALS:
WHEREAS, INMD and Bay Area Fertility entered into a Management
Agreement dated January 7, 1997 (the "Management Agreement")which became
effective as of January 8, 1997 ("Effective Date"); and
WHEREAS, INMD is willing to grant to each of Donald Galen, MD, Arnold
Jacobson, MD and Louis Weckstein, MD, the stockholders of Bay Area Fertility
("Stockholders"), warrants to acquire 15,000 shares, respectively, of INMD
Common Stock (the "Warrants") at a price equal to the closing price of INMD
Common Stock on the date of this Agreement, and with an expiration date of the
Warrants that is five (5) years from issuance.; provided, the Stockholders cause
Bay Area Fertility to amend the Management Agreement so as to extend the term
from 20 years to 25 years; and
WHEREAS, Bay Area Fertility, based on approval of Stockholders, is
willing to extend the Management Agreement for five (5) years so as to expire
twenty-five (25) years from the Effective Date.
NOW THEREFORE, in consideration of the mutual promises and covenants
herein contained, and as contained in the Management Agreement, INMD and Bay
Area Fertility agree as follows:
1. The first sentence of Section 7.2 of The Management Agreement is
hereby deleted and the following sentence is hereby substituted therefor:
"The term of this Agreement shall begin on the Closing date
and shall expire twenty-five (25) years after such date unless
earlier terminated pursuant to Article 8, below."
<PAGE>
2. All other provisions of the Management Agreement, not in conflict
with this Amendment No. 1 remain in full force and effect.
3. This Amendment No. 1 may be executed in any number of separate
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
4. Upon execution of this Amendment by Bay Area Fertility, INMD will
issue the Warrants to the Stockholders.
IN WITNESS WHEREOF, the parties have signed this Amendment No. 1 the
date first above written.
INTEGRAMED AMERICA, INC.
By:/s/Gerardo Canet
------------------------
Gerardo Canet, President
BAY AREA FERTILITY AND GYNECOLOGY MEDICAL GROUP, INC.
By:/s/Arnold Jacobson
--------------------------
Arnold Jacobson, President
AMENDMENT OF SOLICITATION/MODIFICATION OF CONTRACT
Page 1 of Page 5
1. CONTRACT ID CODE
2. AMENDMENT/MODIFICATION NO.: P00004
3. EFFECTIVE DATE: 01/29/98
4. REQUISITION/PURCHASE REQ. NO.: YMEC00-5226-6911
5. PROJECT NO. (if applicable)
6. ISSUED BY: DIR OF CONTRACTING WALTER REED AMC CODE: DADA15
ATTN MCHL Z BLDG T 20
6825 16TH STREET NW
WASHINGTON, DC 20307-5000
7. ADMINISTERED BY (if other than item 6): MARY L. POOL CODE: K29
TEL: (202) 782-1416
8. NAME AND ADDRESS OF CONTRACTOR
(No., street, county, State and ZIP Code)
INTEGRAMED AMERICA, INC. VENDOR ID: 00030356
ONE MANHATTANVILLE ROAD
PURCHASE, NY 105772100
(X) 9A. AMENDMENT OF SOLICITATION NO.:
9B. DATED (SEE ITEM 11):
(X) 10A. MODIFICATION OF CONTRACT/ORDER NO.: DADA15-96-C-0009
10B. DATED (SEE ITEM 13): 12/06/95
- --------------------------------------------------------------------------------
CODE FACILITY CODE
- --------------------------------------------------------------------------------
11. THIS ITEM ONLY APPLIED TO AMENDMENTS OF SOLICITATIONS
|_|The above numbered solicitation is amended as set forth in Item 14. The
hour and date specified for receipt of Offers |_| is extended, |_| is not
extended. Offers must acknowledge receipt of this amendment prior to the
hour and date specified in the solicitation or as amended, by one of the
following methods: (a) By completing Items 8 and 15, and returning
___copies of the amendment; (b) By acknowledging receipt of this amendment
on each copy of the offer submitted; or (c) By separate letter or telegram
which includes a reference to the solicitation and amendment numbers.
FAILURE OF YOUR ACKNOWLEDGMENT TO BE RECEIVED AT THE PLACE DESIGNATED FOR
THE RECEIPT OF OFFERS PRIOR TO THE HOUR AND DATE SPECIFIED MAY RESULT IN
REJECTION OF YOUR OFFER. If by virtue of this amendment you desire to
change an offer already submitted, such change may be made by telegram
letter, provided each telegram or letter makes reference to the
solicitation and this amendment, and is received prior to the opening hour
and date specified.
12. ACCOUNTING AND APPROPRIATION DATA
(if required): Mod Obligated Amount US $ 0.00
NO COST TO THE GOVERNMENT EFT: T
13. THIS ITEM APPLIES ONLY TO MODIFICATIONS OF CONTRACTS/ORDERS,
IT MODIFIED THE CONTRACT/ORDER NO. AS DESCRIBED IN ITEM 14.
(X) A. THIS CHANGE ORDER IS ISSUED PURSUANT TO:(Specify authority)
THE CHANGES SET FORTH IN ITEM 14 ARE MADE IN THE CONTRACT
ORDER NO. IN ITEM 10A
B. THE ABOVE NUMBERED CONTRACT/ORDER IS MODIFIED TO REFLECT THE
ADMINISTRATIVE CHANGES (such as changes in paying office, appropriation
date, etc.) SET FORTH IN ITEM 14, PURSUANT TO THE AUTHORITY OF FAR
43.103(b)
(X) C. THIS SUPPLEMENTAL AGREEMENT IS ENTERED INTO PURSUANT TO AUTHORITY OF:
FAR 52.243.1
D. OTHER (Specify type of modification and authority)
E. IMPORTANT: Contractor | |is not,
|X|is required to sign this document and return
2 copies to the issuing office.
-------------------------------------------------------------------------------
<PAGE>
DESCRIPTION OF AMENDMENT/MODIFICATION (Organized by UCF section headings,
including solicitation/contract subject matter where feasible.)
Subject modification is issued to reflect the following changes:
1. In accordance with Section-H, Paragraph H-3, FAR 52.217-9 "Option To
Extend The Terms Of Contract." The Government elects to exercise its
second option of the contract.
Except as provided herein, all terms and conditions of the document referenced
in item 9A or 10A, as heretofore changed, remains unchanged and in full force
and effect.
15A. NAME AND TITLE OF SIGNER (Type or print):
Donald S. Wood, Ph.D.
IntegraMed America, Inc.
15B. CONTRACTOR/OFFEROR
/s/Donald S. Wood
------------------------------------
(Signature of person authorized to sign)
15C. DATE SIGNED: 4/15/98
16A. NAME AND TITLE OF CONTRACTING OFFICER (Type or print):
Roland Thomas K63
16B. UNITED STATES OF AMERICA
By: /s/Roland Thomas
--------------------------
(Signature of Contracting Officer)
16C. DATE SIGNED: 4/16/98
<PAGE>
SF 30 CONTINUATION SHEET
2. Line items #0003 thru 0003AG for the option period 01 January 1998 thru
December 1998.
3. The statement of work is revised as follows:
C. 1.a2. The Contractor must meet a 50% pregnancy rate for ICSI
(Intracytoplasmic sperm injection) a clinical pregnancies with TESA and MESA
(epidyimal sperm aspiration), and a >40% ongoing delivered pregnancy rate
overall. A >30% pregnancy rate for (FET) frozen embryo transfer cycles. Must
meet HCLA board certified and have CLIA and CAP certification for the
laboratory. Must have twenty (20) or more peer reviewed publications.
Documentation of involvement in a fellow thesis in Reproductive Endocrinology
and Infertility. Must be capable of performing all micromanipulation
techniques ICSI (Intracytoplasmic Sperm Injection) Assisted embryo hatching,
partial zona drilling and support two research protocols per year. Must have
Applied to the Society for Assisted Reproductive Technologies (SART) for
membership and paid required fees, to support SART data collection and input.
Changed: C. 1.a2. The pregnancy rates refer to pregnancies per embryo
transfer for women under age 39 and the rates are to be established over the
one-year contract period for 1998. The Government and the Contractor
recognize that the pregnancy rates are the result of a combined effort that
includes the Contractor and the Government. In addition, the Government and
the Contractor recognize that the pregnancy rates may be affected by
situations such as the air quality over which the Contractor has no control.
Accordingly, if one or more of the pregnancy rates for a given category of
patient do not meet or exceed those in the Statement of Work, the military
and the Contractor agree to cooperate and use their best efforts to improve
the rates to the levels agreed to. Best efforts means that the Contractor and
the Government shall mutually agree to a written plan approved by the
Contracting Officer for improving rates over a reasonable period of time.
C. 1.a3. The Contractor must provide full service cryobiology program to
include storage of embryos and sperm all laboratory equipment and staffing as
work load requires. Capability to move to an outside facility if the military
is unable to provide on-site space.
Changed: C. 1.a3. The Contractor will use its best efforts to move to an
outside facility if the Government is unable to provide on-site space in
support of a cryobiology program. The Government agrees that it will work
cooperatively with the Contractor to agree that it will work cooperatively
with the Contractor to relocate to an outside space and will provide
Contractor with at least 120 days notice that a move of the cryobiology
program to an outside space is necessary. Cooperation includes, but is not
limited to, providing a secure space in which to store all cryobiology
equipment and materials, providing Contractor with access to patient records
for the purpose of notifying patients that a move of the cryobiology program
will take place.
<PAGE>
SF 30 CONTINUATION SHEET
C 1.a4. The Contractor must provide a backup alarm system. All laboratory
employees must carry a beeper and be able to respond to alarm twenty-four
(24) hours a day 365 days per year. C. 1.a9. The Contractor must provide two
(2) nurse coordinators and two (2) full time administrators.
Changed: C. 1.a9. The Contractor is hiring two (2) nurse coordinators and
two (2) full time administrators with the understanding from the Government
that the Statement of Work will be changed as follows:
C. 1.b3. The Government will provide sheltered on-site parking for all
Contractors nursing, administrative and laboratory personnel.
C. 1.b6. Zit is estimated that there will be 350 to 450 procedures per
year.
Added: C. 1.a10. The patients undergoing intrauterine insemination will
be charged an additional $50.00 for sperm washing prepared by the Contractor
for each sample.
///////////////////////////////last item////////////////////////////////////////
<PAGE>
SUPPLIES OR SERVICES AND PRICES/COSTS
Contractor to supply all labor, materials, equipment, and supervision for
developing and staffing an In Vitro Fertilization/Gamete Intra Fallopian
Transfer Laboratory at Walter Reed Army Medical Center. All work shall be
performed in accordance with the Statement of Work and all terms and conditions
of the Contract.
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------
ITEM DESCRIPTION QUANTITY U/I UNIT PRICE AMOUNT
- ---- ----------- -------- --- ---------- ------
<S> <C> <C> <C> <C> <C>
0001 BASE YEAR
01 JANUARY 1996 THRU 31 DECEMBER 31
0001AA BASIC IN VITRO FERTILIZATION (IVF) 300.00 EA 0.000000 0.000000
0001AB BASIC IVF PLUS INTRACYTOPLASMIC 30.00 EA 0.000000 0.000000
INJECTION (ICSI)
0001AC GAMETE INTRAFALLOPIAN TRANSFER (GIFT) 60.00 EA 0.000000 0.000000
0001AD BASIC IVF PLUS ASSISTED HATCHING 100.00 EA 0.000000 0.000000
0001AE CRYOPRESERVATION OF EMBRYOS 200.00 EA 0.000000 0.000000
0001AF STORAGE OF CRYOPRESERVED EMBRYOS 200.00 EA 0.000000 0.000000
0001AG THAWING OF CRYOPRESERVED EMBRYOS 200.00 EA 0.000000 0.000000
0002 FIRST OPTION PERIOD 1 JANUARY 1997
THRU 31 DECEMBER 1997
0002AA BASIC IVF 300.00 EA 0.000000 0.000000
0002AB BASIC IVF PLUS INTRACYTOPLASMIC 30.00 EA 0.000000 0.000000
INJECTION (ICSI)
0002AC GAMETE INTRAFALLOPIAN TRANSFER (GIFT) 60.00 EA 0.000000 0.000000
0002AD BASIC IVF PLUS ASSISTED HATCHING 100.00 EA 0.000000 0.000000
0002AE CRYOPRESERVATION OF EMBRYOS 200.00 EA 0.000000 0.000000
0002AF STORAGE OF CRYOPRESERVED EMBRYOS 200.00 EA 0.000000 0.000000
0002AG THAWING OF CRYOPRESERVED EMBRYOS 200.00 EA 0.000000 0.000000
0003 SECOND OPTION PERIOD 01 JANUARY 1998
THRU 31 DECEMBER 1998
0003AA BASIC IVF 300.00 EA 0.000000 0.000000
0003AB BASIC IVF PLUS INTRACYTOPLASMIC 30.00 EA 0.000000 0.000000
INJECTION (ICSI)
0003AC GAMETE INTRAFALLOPIAN TRANSFER (GIFT) 60.00 EA 0.000000 0.000000
0003AD BASIC IVF PLUS ASSISTED HATCHING 100.00 EA 0.000000 0.000000
0003AE CRYOPRESERVATION OF EMBRYOS 200.00 EA 0.000000 0.000000
0003AF STORAGE OF CRYOPRESERVED EMBRYOS 200.00 EA 0.000000 0.000000
0003AG THAWING OF CRYOPRESERVED EMBRYOS 200.00 EA 0.000000 0.000000
0004 THIRD OPTION PERIOD 01 JANUARY 1999
THRU 31 DECEMBER 1999
0004AA BASIC IVF 300.00 EA 0.000000 0.000000
0004AB BASIC IVF PLUS INTRACYTOPLASMIC 30.00 EA 0.000000 0.000000
INJECTION (ICSI)
0004AC GAMETE INTRAFALLOPIAN TRANSFER (GIFT) 60.00 EA 0.000000 0.000000
0004AD BASIC IVF PLUS ASSISTED HATCHING 100.00 EA 0.000000 0.000000
0004AE CRYOPRESERVATION OF EMBRYOS 200.00 EA 0.000000 0.000000
0004AF STORAGE OF CRYOPRESERVED EMBRYOS 200.00 EA 0.000000 0.000000
0004AG THAWING OF CRYOPRESERVED EMBRYOS 200.00 EA 0.000000 0.000000
</TABLE>
AMENDMENT NO. 1 TO MANAGEMENT AGREEMENT
BETWEEN
SHADY GROVE FERTILITY CENTERS, INC.
AND
LEVY, SAGOSKIN AND STILLMAN, M.D., P.C.
THIS AMENDMENT NO. 1 TO MANAGEMENT AGREEMENT ("Amendment No. 1") is
dated April 16, 1998 by and among IntegraMed America, Inc., a Delaware
corporation, with its principal place of business at One Manhattanville Road,
Purchase, New York 10577("IntegraMed"), Shady Grove Fertility Centers, Inc., a
Maryland corporation, having a place of business at One Manhattanville Road,
Purchase, New York 10577 ("Shady Grove") and Levy, Sagoskin and Stillman, M.D.,
P.C., a Maryland professional corporation, with a place of business at 9707
Medical Center Drive, Suite 230, Rockville, Maryland 20850 ("PC").
RECITALS:
WHEREAS, Shady Grove and PC entered into a Management Agreement
("Management Agreement") dated March 11, 1998 ("Effective Date") pursuant to
which Shady Grove agreed to provide certain management and administrative
services to PC for a period of 20 years (the "Term"); and
WHEREAS, IntegraMed acquired the majority of the stock of Shady Grove
on March 12, 1998; and
WHEREAS, Shady Grove and IntegraMed, entered into a Submanagement
Agreement ("Submanagement Agreement"), with PC's consent, dated March 12, 1998
pursuant to which IntegraMed agreed to perform certain duties and
responsibilities of Shady Grove under the Management Agreement; and
WHEREAS, PC desires to establish terms and conditions regarding any
expansion that Shady Grove and/or IntegraMed will make with respect to
management agreements with other medical practices within defined geographic
limits of PC's medical offices and Shady Grove and PC are willing to limit such
expansion within defined geographic limits as set forth in this Amendment No. 1;
and
<PAGE>
WHEREAS, IntegraMed, is willing to grant to each of Michael J. Levy,
M.D., Arthur W.Sagoskin, M.D. and Robert J. Stillman, M.D., each a stockholder
of PC ("Stockholders"), warrants to acquire 15,000 shares, respectively, of
IntegraMed Common Stock (the "Warrants") at a price equal to the closing price
of IntegraMed's Common Stock on the date hereof and with an expiration date of
the Warrants that is five (5) years from the date hereof; provided, the
Stockholders cause PC to amend the Management Agreement so as to extend the Term
to 25 years; and
WHEREAS, PC, based on approval of Stockholders, is willing to extend
the Management Agreement for five (5) years so as to expire twenty-five (25)
years from the Effective Date.
NOW THEREFORE, in consideration of the mutual promises and covenants
herein contained, and as contained in the Management and Submanagement
Agreements, IntegraMed, Shady Grove and PC agree as follows:
1. The first sentence of Section 8.2 of The Management Agreement is
hereby deleted and the following sentence is hereby substituted therefor:
"The term of this Agreement shall begin on March 11, 1998 (the
'Effective Date') and shall expire twenty-five (25) years
after the Effective Date unless earlier terminated pursuant to
Article 9 below."
2. The Management Agreement is hereby amended to add the following new
Section 8.3 to Article 8:
"8.3 Management Company agrees that during the term of this
Agreement, Management Company will not manage or provide
administrative services to any other medical practice that is
competitive to PC within the geographical area outlined in the
territory established on the attached Exhibit 8.3, without
PC's prior written consent."
3. All other provisions of the Management Agreement not in conflict
with this Amendment No. 1 remain in full force and effect.
4. During the Term of the Management Agreement or so long as IntegraMed
owns the majority of the outstanding stock of Shady Grove, IntegraMed agrees not
to manage any other medical practice that is competitive to PC within the
geographical area outlined in the territory set forth in Exhibit 8.3 to the
Management Agreement.
5. Within 7 days of execution of this Amendment No. 1 IntegraMed will
deliver the Warrants to the respective Stockholders.
6. This Amendment No. 1 may be executed in any number of separate
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
<PAGE>
IN WITNESS WHEREOF, the parties have signed this Amendment No. 1 the
date first above written.
INTEGRAMED AMERICA, INC.
By: /s/Gerardo Canet
------------------------
Gerardo Canet, President
SHADY GROVE FERTILITY CENTERS, INC.
By: /s/Gerardo Canet
------------------------
Gerardo Canet, President
LEVY, SAGOSKIN AND STILLMAN, M.D., P.C.
By: /s/ Michael J. Levy, MD
-------------------------------
Michael J. Levy, M.D., President
<TABLE> <S> <C>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-mos
<FISCAL-YEAR-END> Dec-31-1998
<PERIOD-START> Jan-01-1998
<PERIOD-END> Mar-31-1998
<CASH> 2,379
<SECURITIES> 0
<RECEIVABLES> 13,311
<ALLOWANCES> 477
<INVENTORY> 0
<CURRENT-ASSETS> 17,713
<PP&E> 5,366<F1>
<DEPRECIATION> 0
<TOTAL-ASSETS> 48,880
<CURRENT-LIABILITIES> 10,608
<BONDS> 0
0
166
<COMMON> 213
<OTHER-SE> 32,806
<TOTAL-LIABILITY-AND-EQUITY> 48,880
<SALES> 8,746
<TOTAL-REVENUES> 8,746
<CGS> 7,009
<TOTAL-COSTS> 7,009
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 72
<INCOME-PRETAX> 259
<INCOME-TAX> 49
<INCOME-CONTINUING> 210
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 210
<EPS-PRIMARY> 0.01
<EPS-DILUTED> 0.01
<FN>
<F1>
PP&E is net of accumulated depreciation.
</FN>
</TABLE>
